Central Valley Construction (CVC) purchased $80,000 of sheet metal fabricating equipment from Buffalo Supply on January 1, 2017. CVC paid $15,000 cash and signed a five-year, 10% note for the remaining $65,000 of the purchase price. The note specifies that payments of $13,000 plus interest be made each year on the loan's anniversary date. CVC made the required January 1, 2018, payment but was unable to make the second payment on January 1, 2019, because of a downturn in the construction industry. At this time, CVC owed Buffalo Supply $52,000 plus $5,200 interest that had been accrued by both companies. Rather than write off the note and repossess the equipment, Buffalo Supply agreed to restructure the loan as one payment of $50,000 on January 1, 2021, to satisfy the restructured note.
Required:
Prepare the entries CVC and Buffalo Supply would make on January 1, 2019, to record the restructuring.