On December 31, 2023, Green Bank enters into a debt restructuring agreement with Windsor Inc., which is now experiencing financial trouble. The bank agrees to restructure a $3-million, 10% note receivable issued at par by the following modifications: 1. Reducing the principal obligation from $3 million to $2.9 million Extending the maturity date from December 31, 2023, to December 31, 2026 3. Reducing the interest rate from 10% to 8% 2. Windsor pays interest at the end of each year. On January 1, 2027, Windsor pays $2.9 million in cash to Green Bank. Windsor prepares financial statements in accordance with IFRS 9.
On December 31, 2023, Green Bank enters into a debt restructuring agreement with Windsor Inc., which is now experiencing financial trouble. The bank agrees to restructure a $3-million, 10% note receivable issued at par by the following modifications: 1. Reducing the principal obligation from $3 million to $2.9 million Extending the maturity date from December 31, 2023, to December 31, 2026 3. Reducing the interest rate from 10% to 8% 2. Windsor pays interest at the end of each year. On January 1, 2027, Windsor pays $2.9 million in cash to Green Bank. Windsor prepares financial statements in accordance with IFRS 9.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:On December 31, 2023, Green Bank enters into a debt restructuring agreement with Windsor Inc., which is now experiencing
financial trouble. The bank agrees to restructure a $3-million, 10% note receivable issued at par by the following modifications:
Reducing the principal obligation from $3 million to $2.9 million
Extending the maturity date from December 31, 2023, to December 31, 2026
3. Reducing the interest rate from 10% to 8%
1.
2.
Windsor pays interest at the end of each year. On January 1, 2027, Windsor pays $2.9 million in cash to Green Bank. Windsor
prepares financial statements in accordance with IFRS 9.
Transcribed Image Text:Prepare an entry at December 31, 2023, based on the results of your calculation. (Round answers to O decimal places, e.g. 5,275.
Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No
Entry" for the account titles and enter O for the amounts. List debit entry before credit entry.)
Date
December
31, 2023
Account Titles and Explanation
Debit
Credit
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