Suppose that on January 1, Year 1 a debtor owed a creditor a $6,573 (face) non-interest-bearing note due on this date. The interest rate implied on this note is 8%. The debtor was unable to pay the total amount and the parties agreed to a restructure in which the debtor would make the following restructured payments: (1) restructured face value of $5,000 due December 31, Year 6, (2) annual interest payments at 10% of the new face value, beginning December 31, Year 1. What would be the debtor’s journal entries on a. January 1, Year 1? b. December 31, Year 1? c. December 31, Year 2? d. December 31, Year 6?

Q: On December 31, 2021, the VKS Finance Company had a P3,000,000 note receivable from JP Company. The…

A: Computation of recoverable amount from note receivable on December 31, 2021:   Year cashflow pv…

Q: Gliezel company has an overdue 8% note payable to City Bank at P4,000,000 and recorded accrued…

A: The question is based on debt reconstruction. This is done bring the bussiness out of stress by…

Q: At December 31, 2019, one of TOCINO Company’s credit customers, HOTDOG Trading, is experiencing…

A: Introduction to Impairment loss Impairment loss generally occurs when a business asset suffers a…

Q: This Company defaulted in two annual interest   payments on its P4,000,000 loan. Because of the…

A: As per IFRS 9, Financial instruments, the interest expense on the financial liability is recognized…

Q: At January 1, 2016, Brainard Industries, Inc., owed Second BancCorp $12 million under a 10% note due…

A:

Q: Mann Corporation’s liability account balances at June 30,2001, included a 10% note payable in the…

A: Given information, Note payable in the amount of P3,600,000. The first payment was made on on…

Q: Included in Panera Corporation’s liability account balances at December 31, 2004 was a Note payable…

A: We shall first calculate the Outstanding note balance on December 31, 2005 Out of this amount, the…

Q: The Nile Group is owed $1,010,000 by Scorpion Enterprises under an 10% note with three years…

A: Bad debt expense is the business expense that is incurs when the repayment of the credit priorly…

Q: On January 1, 200A, ABC rendered services to XYZ. There is no established selling price for the…

A: Carrying value of the note receivable at the end of December 200B = Present value of Face value of…

Q: On January 1, 2020 , the lending company made a 200,000 8% loan . The interest is receivable at the…

A: Impairment loss is the difference which is calculated when fair value of the asset is less than its…

Q: othschild Chair Company, was indebted to First Lincoln Bank under a $20 million, 10% unsecured note.…

A: Step 1 Journal is the part of book keeping.

Q: On January 1, Pina Colada Corp. lent $38,000 to Kingbird, Inc., accepting Kingbird's $50,578,…

A: PLEASE LIKE THE ANSWER, YOUR RESPONSE MATTERS   Account title and explanation  Debit  Credit…

Q: Oakwood Corporation is delinquent on a $2,400,000, 10% note to Second National Bank that was due…

A: Debt Restructuring - It is restructured agreement which refer to change in terms of debt due to…

Q: interest income

A: Interest income on note receivable = Value of note receivable * Rate of interest

Q: On Dec. 31, 20x1, Tissue Co. determines that its loan receivable from Breakfast Co. with a carrying…

A: Loan is an amount which a lender gives to a borrower to fulfil the financial need of the borrower at…

Q: On February 1, 2020, Henson Company factored receivables with a carrrrying amount of $700,000 to…

A: Determine the amount of loss on sale to be reported in the income statement.

Q: ABC Company is in financial difficulties and was not able to pay the 10% interest of P100,000 due on…

A: One of the source used by the business entities so as to raise the funds and meet the financial…

Q: on March 1, 20x1 Nick Co. issued a P6000, 12%note dated January 1, 20x1 in exchange an outstanding…

A: In exchange for accounts payable, if notes payable are issued then accounts payable should be…

Q: At January 1, 2021, NCI Industries, Inc. was indebted to First Federal Bank under a $240,000, 10%…

A: 1 ) Calculation of Present value of debt = ( 240000 + ( 240000 x 10 % ) )…

Q: January 1, 20x1, ABC Bank extended a P1,000,000 loan to XYZ. Principal is due on December 31, 20x5…

A: Explanation of Concept Current problem is related to the concept of impairment of asset value. Every…

Q: At January 1, 2021, Rothschild Chair Company, Inc., was indebted to First Lincoln Bank under a $20…

A: S.No. Account titles and explanations Debit Credit 1) Land  $       3.00        Gain on disposal…

Q: Gliezel company has an overdue 8% note payable to City Bank at P4,000,000 and recorded accrued…

A: Here are the cashflows for the liabilities, if the reconstruction is implemented.  Time   cashflow 0…

Q: Due to extreme financial difficulties, ARMADA Company had negotiated a restructuring of a 10%…

A: Debt restructuring means restructuring the terms like maturity, interest rate etc. or to swap with…

Q: On November 1, Kotler Company accepted a 3-month note receivable as payment for services provided to…

A: From November 1 to December 31 = 2 months Interest accrued on December 31 = $9,000 x 6% x 2/12 = $90…

Q: In 2X19, Land Corporation acquired land by paying P2,000,000 and signing a note with a face value of…

A: NOTE: As per BARTLEBY guidelines, when multiple sub parts are given then first three sub parts are…

Q: On December 31, 2019, Kale Bank entered into a debt restructuring agreement with Miserable Corp.,…

A: Ans. P 56,000 Working Notes: Principle :  P 700,000 Rate of Interest: 8% Time : 1 Year

Q: On May, 2020, Manara Company factored receivables of $200,000 to National Company. National Company…

A: Since Manara Company factors the receivables on a without recourse basis

Q: EXO Company accepted a P400,000 face value, six-month, 9% note dated May 15 from a customer. After…

A: Interest accrued =  face value of note x rate of interest x no. of months/12 = P400,000 x 9% x 2/12…

Q: How much is the notes receivable as presented in the balance sheet at Dec 31, 20X1?

A: Given in the question: Land has been sold by ABC Co. on Jan 1, 20X1 The fair value of the land was =…

Q: At January 1, 2018, Rothschild Chair Company, Inc., was indebted to First Lincoln Bank under a $20…

A:

Q: On December 31, 2020, American Bank enters into a debt restructuring agreement with Barkley Company,…

A: Note: Since we are entitled to answer up to 3 sub-parts, we’ll answer the first 3. Please resubmit…

Q: On December 31, 2012, Greendale Corporation is experiencing extreme financial pressure and is in…

A: Debt Restructuring: Businesses and individuals that want to avoid being placed on the defaulters'…

Q: On December 31, 2020, the Reliable Finance Company had P5,000,000 notes receivable from Burgundy…

A: Working Notes: Computation of present value of restructured notes receivable. 400000 * 0.83 =…

Q: On December 31 , 2018 Nicholas Co. is in financial difficulty and cannot pay a note due that day .…

A: (Note: We’ll answer the first question since the exact one wasn’t specified. Please submit a new…

Q: Mar Company provides the following information on December 31, 2020: Income taxes withheld from…

A: Current liabilities are those types of obligations that must be fulfilled within a year. Creditors,…

Q: On January 1, 20x1, ABC Bank extended a P1,000,000 loan to XYZ. Principal is due on December 31,…

A: Loan definition:- Loan is basically lending of money by persons, entities or organizations to other…

Q: The balance in the Debtors Control account at the end of the financial year was R30 000 before the…

A: Formula: Provision for bad debts = Total Debtors balance x Provision for bad debts percentage.

Q: On January 1, 2020, Wilson Co. signed a three year note with Chase Bank. The note was for $10…

A: FASB (Financial Accounting Standards Board) is a body that sets accounting standards in accordance…

Q: At December 31, 2019, one of MNO Company's credit customers, 123A, is experiencing financial…

A: The impairment loss is recognized if the market value of the investment is lower than the carrying…

Q: On December 31, 2020, American Bank enters into a debt restructuring agreement with Shamrock…

A: Loan: It is the amount of money borrowed from a person or bank or company for a certain period…

Q: At January 1, 2018, Brainard Industries, Inc., owed Second BancCorp $12 million under a 10% note due…

A: 1.

Q: Company received from a customer a one-year, P500,000 note bearing annual interest of 8%. After…

A: The company will sell the products at cash or at credit. If the company sells the product at credit,…

Q: Due to extreme financial difficulties, Armand Company had negotiated a restructuring of a 10% P…

A: Notes payable refers to the amount of the bill that the company owes from the vendors or suppliers.…

Q: On January 1, 2018, Granada Company has an overdue 8% note payable to First Bank at P8,000,000 and…

A: The gain on the debt extinguishment refers to the difference among the debt carrying value as well…

Q: Ames, Inc. has $500,000 of notes payable due June 15, year 3. Ames signed an agreement on December…

A: The company can borrow funds for expansion or to purchase the capital assets. The borrowing can be…

Q: On December 31, 2012, Greendale 2 Corporation is experiencing extreme financial pressure and is in…

A: Gain on debt restructuring = Carrying amount of old loan - Present Value of Restructure Liability

Q: On January 1, 2020, Wilson Co. signed a three year note with Chase Bank. The note was for $10…

A: ANSWER     Accounting Standards Codification (ASC) 470-60 is the section that defines how Wilson…

Q: An entity had an outstanding loan of P3,000,000. The loan has an effective interest rate of 12%. On…

A: Bond interest expenditure is the total interest expense for a company's bonds due throughout an…