Gaming Inc. issued a debenture bond to Karamoutz Bank to finance new technology it developed. The debenture was for $500,000, issued at face value, with a 10-year term and interest payable at 10%. Gaming Inc.'s new technology proved not to be technically feasible and caused it to go into financial distress. The debenture is due today, December 31, 2020, and Gaming does not have the funds to repay the debenture or the interest. As a result, Karamoutz agreed to extend the debenture due date for five more years and reduce the principal amount to $300,000 in exchange for receiving 20,000 common shares of Gaming, currently trading at $5 per share. Interest will still be payable at 10% and will continue to be due annually on December 31 of each year. The current market rate is 12%. Gaming prepares financial statements in accordance with IFRS. 

Instructions

Using (1) factor tables, (2) a financial calculator, or (3) Excel function PV, prepare all the necessary journal entries on the books of Gaming Inc. from the time of restructuring the debenture through maturity. Round to the nearest dollar.