Creditor entries for modification of troubled debt, Accounting Basics

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Creditor entries for modification of troubled debt

Vista Corp. owes $600,000 to First National. The debt is 10-year, 10% note due December 31, 2014. Because Vista Corp. is in financial trouble, First National agrees to extend maturity date to December 31, 2017, reduce principal to $500,000, and reduce interest rate to 6%, payable annually on December 31.

Instructions

(a) Prepare the journal entries on Vista's books on December 31, 2014, 2015, 2016, 2017.

(b) Prepare the journal entries on First National's books on December 31, 2014, 2015, 2016, 2017.

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Accounting Basics: Creditor entries for modification of troubled debt

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Accounting Basics: Creditor entries for modification of troubled debt

Reference No:- TGS0512939

Have a Question? (oR Write a Review)

Recent Questions Asked Accounting Basics

Q : Lump-sum sales of stock with preferred stock

Q : Which bank should xcf borrow

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Q : Quantity and time frame

Q : Creditor entries for modification of troubled debt

Q : Inexpensively switch production from one product to another

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Request for Solution File

Ask an Expert for Answer!!

Accounting Basics: Creditor entries for modification of troubled debt

Reference No:- TGS0512939

Recent Questions Asked Accounting Basics

Q : Lump-sum sales of stock with preferred stock

Q : Which bank should xcf borrow

Q : Question regrading the stock issued for land

Q : Quantity and time frame

Q : Creditor entries for modification of troubled debt

Q : Inexpensively switch production from one product to another

Q : Functions of the marketing management process

Q : Prepare a statement of cash flows for reynolds

Q : Manufacturing design and development

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