Question: Tsui Corporation went through a financial reorganization by writing down
Tsui Corporation went through a financial reorganization by writing down plant assets by $107,000 and eliminating its deficit, which was $182,000 before the reorganization. As part of the reorganization, the creditors agreed to take back 55% of the common shares in lieu of payment of the debt of $1.8 million. Prepare the entries to record the financial reorganization assuming that Tsui follows private enterprise GAAP.
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