Island Corporation owes Mutual Bank a 10% note payable for $100,000 plus $8,000 accrued interest. On October 1, 20X1. Is
Posted: Mon May 30, 2022 6:22 am
Island Corporation owes Mutual Bank a 10% note payable for
$100,000 plus $8,000 accrued interest. On October 1, 20X1. Island
and Mutual Bank execute an agreement whereby Island will pay Mutual
$128,000 on the due date of the note on October 1, 20X3.
Mutual Bank will record this transaction to recognize:
Multiple Choice
a receivable restructuring gain of $2,214.
a debt restructuring loss of $2,214.
a debt restructuring loss of $8,000.
neither a gain nor a lost from debt restructuring.
$100,000 plus $8,000 accrued interest. On October 1, 20X1. Island
and Mutual Bank execute an agreement whereby Island will pay Mutual
$128,000 on the due date of the note on October 1, 20X3.
Mutual Bank will record this transaction to recognize:
Multiple Choice
a receivable restructuring gain of $2,214.
a debt restructuring loss of $2,214.
a debt restructuring loss of $8,000.
neither a gain nor a lost from debt restructuring.