On December $31,2025,$ American Bank enters into a debt restructuring agreement with Blossom Company, which is now experiencing financial trouble. The bank agrees to restructure a $12\%,$ issued at par$$3,100,000$ note receivable by the following modifications: $1)$ Reducing the principal obligation from $$3,100,000$ to $$2,080,000.2)$ Extending the maturity date from December $31,2025,$ to January $1,2029.3)$ Reducing the interest rate from $12\%$ to $10\%.$ Blossom pays interest at the end of each year. On January $1,2029,$ Blossom Company pays $$2,080,000$ in cash to American Bank.

a$)$ Can Blossom Company record a gain under this term modification? Compute the gain for Blossom Company.

b$)$ Prepare the journal entries to record the gain on Blossom's books$($If no entry is required, select $"$No Entry" for the account titles and enter for the amounts. Credit account titles are automatically indented when the amount is entered. Do not indent manually. List debit entry before credit entry.$)"$ Date", "Account Titles and Explanation," and "Debit" and "Credit," are the labels on the table. December $31,2025$ is the date. $1$ debit$/1$ credit to record for the single journal entry.

c$)$ what interest rate should Blossom use to compute its interest expense in future periods?

d$)$ prepare the interest payment schedule of the note for blossom company after the debt restructuring

make a table using the labels: date, cash paid, interest expense, reduction of carrying amount, and carrying value of note. The dates to use are below:

$12/31/25$

$12/31/26$

$12/31/27$

$12/31/28$

e$)$ prepare the interest payment entries for blossom company on December $31$ of $2026,2027,$ and $2028.$ Do $3$ journal entries with $2$ debits$/$credit each.

f$)$ what entry should blossom make on January $1,2029?$ One journal entry, $2$ debits$/$credits