Question: Exercise 14-27 Partially correct answer. Your answer is partially correct. Try again. Larkspur Corp. owes $251,000 to Cullumber Trust. The debt is a 10-year, 12%

Exercise 14-27 Partially correct answer. Your answer is partially correct. Try again. Larkspur Corp. owes $251,000 to Cullumber Trust. The debt is a 10-year, 12% note due December 31, 2017. Because Larkspur Corp. is in financial trouble, Cullumber Trust agrees to extend the maturity date to December 31, 2019, reduce the principal to $203,000, and reduce the interest rate to 5%, payable annually on December 31. (a) Prepare the journal entries on Larkspurs books on December 31, 2017, 2018, 2019. (b) Prepare the journal entries on Cullumber Trusts books on December 31, 2017, 2018, 2019.

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