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(Term Modification with GainCreditors Entries) Using the same information as in E14-21 and E14-23 above, answer the following questions related...

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(Term Modification with Gain—Creditor’s Entries) Using the same information as in E14-21 and E14-23 above, answer the following questions related to American Bank (creditor).

(a) Compute the loss American Bank will suffer under this new term modification. Prepare the journal entry to record the loss on American’s books.

(b) Prepare the interest receipt schedule for American Bank after the debt restructuring.

(c) Prepare the interest receipt entry for American Bank on December 31, 2011, 2012, and 2013.

(d) What entry should American Bank make on January 1, 2014?

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a The loss can be calculated as follows Pre restructuring carrying amount of note Less Present value …View the full answer


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Intermediate Accounting

Intermediate Accounting

ISBN: 978-0470423684

13th Edition

Authors: Donald E. Kieso, Jerry J. Weygandt, And Terry D. Warfield

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Question Posted: December 21, 2010 02:01:44
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