Rothschild Chair Company, Incorporated, was Indebted to First Lincoln Bank under a $22 million, 10% unsecured note. The note was signed January 1, 2014, and was due December 31, 2027. Annual interest was last paid on December 31, 2022. At January 1, 2024, Rothschild Chair Company was experiencing severe financial difficulties and negotiated a restructuring of the terms of the debt agreement. Note: Use appropriate factor(s) from the tables provided. (EV of $1. PV of $1. EVA of $1. PVA of $1. EVAD of $1 and PVAD of $1 Required: Prepare all journal entries by First Lincoln Bank to record the restructuring and any remaining transactions, for current and future years, relating to the debt under each of the independent circumstances below: 1. First Lincoln Bank agreed to settle the debt in exchange for land having a fair value of $18 million but carried on Rothschild Chair Company's books at $15 million. 2. First Lincoln Bank agreed to (a) forgive the interest accrued from last year, (b) reduce the remaining four interest payments to $1.1 million each, and (c) reduce the principal to $17 million. ✪ Answer is not complete. Complete this question by entering your answers in the tabs below. Required 1 Required 2 First Lincoln Bank agreed to (a) forgive the interest accrued from last year, (b) reduce the remaining four interest payments to $1.1 million each, and (c) reduce the principal to $17 million. Note: If no entry is required for a transaction/event, select "No journal entry required in the first account field. Round your intermediate and final answer to whole dollars.
Rothschild Chair Company, Incorporated, was Indebted to First Lincoln Bank under a $22 million, 10% unsecured note. The note was signed January 1, 2014, and was due December 31, 2027. Annual interest was last paid on December 31, 2022. At January 1, 2024, Rothschild Chair Company was experiencing severe financial difficulties and negotiated a restructuring of the terms of the debt agreement. Note: Use appropriate factor(s) from the tables provided. (EV of $1. PV of $1. EVA of $1. PVA of $1. EVAD of $1 and PVAD of $1 Required: Prepare all journal entries by First Lincoln Bank to record the restructuring and any remaining transactions, for current and future years, relating to the debt under each of the independent circumstances below: 1. First Lincoln Bank agreed to settle the debt in exchange for land having a fair value of $18 million but carried on Rothschild Chair Company's books at $15 million. 2. First Lincoln Bank agreed to (a) forgive the interest accrued from last year, (b) reduce the remaining four interest payments to $1.1 million each, and (c) reduce the principal to $17 million. ✪ Answer is not complete. Complete this question by entering your answers in the tabs below. Required 1 Required 2 First Lincoln Bank agreed to (a) forgive the interest accrued from last year, (b) reduce the remaining four interest payments to $1.1 million each, and (c) reduce the principal to $17 million. Note: If no entry is required for a transaction/event, select "No journal entry required in the first account field. Round your intermediate and final answer to whole dollars.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
A-3
Transcribed Image Text:Powiem 7-19 (Miyu) TUUNIEN VENTEsuulluning (Appericia 79)
Rothschild Chair Company, Incorporated, was Indebted to First Lincoln Bank under a $22 million, 10% unsecured note. The note was
signed January 1, 2014, and was due December 31, 2027. Annual interest was last paid on December 31, 2022. At January 1, 2024,
Rothschild Chair Company was experiencing severe financial difficulties and negotiated a restructuring of the terms of the debt
agreement.
Note: Use appropriate factor(s) from the tables provided. (FV of $1. PV of $1. FVA of $1. PVA of $1. FVAD of $1 and PVAD of $1)
Required:
Prepare all journal entries by First Lincoln Bank to record the restructuring and any remaining transactions, for current and future
years, relating to the debt under each of the independent circumstances below:
1. First Lincoln Bank agreed to settle the debt in exchange for land having a fair value of $18 million but carried on Rothschild Chair
Company's books at $15 million.
2. First Lincoln Bank agreed to (a) forgive the interest accrued from last year, (b) reduce the remaining four interest payments to $1.1
million each, and (c) reduce the principal to $17 million.
Answer is not complete.
Complete this question by entering your answers in the tabs below.
Required 2
First Lincoln Bank agreed to (a) forgive the interest accrued from last year, (b) reduce the remaining four interest payments
to $1.1 million each, and (c) reduce the principal to $17 million.
Required 1
Note: If no entry is required for a transaction/event, select "No journal entry required in the first account field. Round your
intermediate and final answer to whole dollars.
NO
1
2
3
4
5
6
Date
January 01, 2024 Bad debt expense
Interest receivable
Allowance for uncollectible accounts
December 31, 202 Cash
Allowance for uncollectible accounts
Interest revenue
December 31, 202 Cash
General Journal
Allowance for uncollectible accounts
Interest revenue
December 31, 202 Cash
Allowance for uncollectible accounts
Interest revenue
December 31, 202 Cash
Allowance for uncollectible accounts
Interest revenue
December 31, 202 Cash
Allowance for uncollectible accounts
Notes receivable
3
Debit
1,100,000
1,100,000
1,100,000
1,100,000
17,000,000
5,000,000
Credit
2,200,000
22,000,000
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