Rothschild Chair Company, Incorporated, was indebted to First Lincoln Bank under a $40 million, 10% unsecured note. Thenote was signed January 1, 2014, and was due December 31, 2027. Annual interest was last paid on December 31, 2022. AtJanuary 1, 2024, Rothschild Chair Company was experiencing severe financial difficulties and negotiated a restructuring ofthe terms of the debt agreement.Note: Use appropriate factor(s) from the tables provided. (FV of $1. PV of $1. EVA of $1. PVA of $1. EVAD of $1 and PVAD of$.1)Required:Prepare all journal entries by First Lincoln Bank to record the restructuring and any remaining transactions, for current andfuture years, relating to the debt under each of the independent circumstances below:1. First Lincoln Bank agreed to settle the debt in exchange for land having a fair value of $36 million but carried onRothschild Chair Company's books at $33 million.2. First Lincoln Bank agreed to (a) forgive the interest accrued from last year, (b) reduce the remaining four interestpayments to $2.8 million each, and (c) reduce the principal to $35 million.

S.No.Account titles and explanationsDebitCredit1)Land $ 3.00 Gain on disposal of assets $…

Answered: equired: repare all journal entries by…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Rothschild Chair Company, Incorporated, was indebted to First Lincoln Bank under a $20 million, 10% unsecured note. The note was signed January 1, 2014, and was due December 31, 2027. Annual interest was last paid on December 31, 2022. At January 1, 2024, Rothschild Chair Company was experiencing severe financial difficulties and negotiated a restructuring of the terms of the debt agreement. Note: Use appropriate factor(s) from the tables provided. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) Required: Prepare all journal entries by First Lincoln Bank to record the restructuring and any remaining transactions, for current and future years, relating to the debt under each of the independent circumstances below: 1. First Lincoln Bank agreed to settle the debt in exchange for land having a fair value of $16 million but carried on Rothschild Chair Company's books at $13 million. 2. First Lincoln Bank agreed to (a) forgive the interest accrued from last year, (b)…
At January 1, 2024, Rothschild Chair Company, Incorporated, was indebted to First Lincoln Bank under a $35 million, 12% unsecured note. The note was signed January 1, 2021, and was due December 31, 2027. Annual interest was last paid on December 31, 2022. Rothschild Chair Company was experiencing severe financial difficulties and negotiated a restructuring of the terms of the debt agreement. Required: Prepare all journal entries by Rothschild Chair Company, Incorporated, to record the restructuring and any remaining transactions relating to the debt under each of the independent circumstances below: 1. First Lincoln Bank agreed to settle the debt in exchange for land having a fair value of $31 million but carried on Rothschild Chair Company's books at $26.5 million. 2. First Lincoln Bank agreed to (a) forgive the interest accrued from last year, (b) reduce the remaining four interest payments to $1 million each, and (c) reduce the principal to $28.5 million. 3. First Lincoln Bank…
At January 1, 2018, Rothschild Chair Company, Inc., was indebted to First Lincoln Bank under a $20 million,10% unsecured note. The note was signed January 1, 2015, and was due December 31, 2021. Annual interest waslast paid on December 31, 2016. Rothschild Chair Company was experiencing severe financial difficulties andnegotiated a restructuring of the terms of the debt agreement.Required:Prepare all journal entries by Rothschild Chair Company, Inc., to record the restructuring and any remainingtransactions relating to the debt under each of the independent circumstances below:1. First Lincoln Bank agreed to settle the debt in exchange for land having a fair value of $16 million but carriedon Rothschild Chair Company’s books at $13 million.2. First Lincoln Bank agreed to (a) forgive the interest accrued from last year, (b) reduce the remaining fourinterest payments to $1 million each, and (c) reduce the principal to $15 million.3. First Lincoln Bank agreed to defer all payments…
At January 1, 2024, NCI Industries, Incorporated was indebted to First Federal Bank under a $246,000, 10% unsecured note. . The note was signed January 1, 2017, and was due December 31, 2025. Annual interest was last paid on December 31, 2022. • NCI was experiencing severe financial difficulties and negotiated a restructuring of the terms of the debt agreement. • First Federal agreed to reduce last year's interest and the remaining two years' interest payments to $11,844 each and delay all payments until December 31, 2025, the maturity date. Required: Prepare the journal entries by NCI Industries, Incorporated, necessitated by the restructuring of the debt at (1) January 1, 2024; (2) December 31, 2024; and (3) December 31, 2025. Note: Do not round intermediate calculations. Round final answers to the nearest whole dollar. If no entry is required for a transaction/event, select "No journal entry required in the first account field. Use tables, Excel, or a financial calculator. (FV of…
At January 1, 2021, Rothschild Chair Company, Inc., was indebted to First Lincoln Bank under a $39 million, 10% unsecured note. The note was signed January 1, 2018, and was due December 31, 2024. Annual interest was last paid on December 31, 2019. Rothschild Chair Company was experiencing severe financial difficulties and negotiated a restructuring of the terms of the debt agreement. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) (Use appropriate factor(s) from the tables provided.) Required: Prepare all journal entries by Rothschild Chair Company, Inc., to record the restructuring and any remaining transactions relating to the debt under each of the independent circumstances below: 1. First Lincoln Bank agreed to settle the debt in exchange for land having a fair value of $35 million but carried on Rothschild Chair Company's books at $30.1 million. 2. First Lincoln Bank agreed to (a) forgive the interest accrued from last year, (b) reduce the remaining four…
Rothschild Chair Company, was indebted to First Lincoln Bank under a $20 million, 10% unsecured note. The note was signed January 1, 2011, and was due December 31, 2024. Annual interest was paid on December 31, 2019. At January 1, 2021, Rothschild Chair Company was experiencing severe financial difficulties and negotiated a restructuting of the terms of the debt agreement. REQUIRED: Prepare all journal entries by First Lincoln Bank to record the restructuring and any remaining transactions, for current and future years, relating to the debt under each of the independent circumstances below: 1.-First Linconl Bank agreed to settle the debt in exchange for land having a fair value of $16 million but carried on Rothschild Chair company's book at $13 million 2.-First Lincoln Bank agreed to a) forgive the interest accrued from last year, b) reduce the remaining four interest payments to $1 million each, and c) reduce the principal to $15 million
At January 1, 2024, Clayton Hoists Incorporated owed Third BancCorp $31 million, under a 10% note due December 31, 2025. Interest was paid last on December 31, 2022. Clayton was experiencing severe financial difficulties and asked Third BancCorp to modify the terms of the debt agreement. After negotiation Third BancCorp agreed to do the following: Note: Use appropriate factor(s) from the tables provided. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) ● Forgive the interest accrued for the year just ended. • Reduce the remaining two years' interest payments to $1 million each. ● Reduce the principal amount to $30 million. Required: 1-3. Prepare the journal entries by Third BancCorp necessitated by the restructuring of the debt at January 1, 2024, December 31, 2024 and December 31, 2025. Note: Enter your answers in whole dollars. If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Round your final answers…
At January 1, 2021, Rothschild Chair Company, Inc., was indebted to First Lincoln Bank under a $20 million, 10% unsecured note. The note was signed January 1, 2018, and was due December 31, 2024. Annual interest was last paid on December 31, 2019. Rothschild Chair Company was experiencing severe financial difficulties and negotiated a restructuring of the terms of the debt agreement. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) (Use appropriate factor(s) from the tables provided.) Required: Prepare all journal entries by Rothschild Chair Company, Inc., to record the restructuring and any remaining transactions relating to the debt under each of the independent circumstances below: 1. First Lincoln Bank agreed to settle the debt in exchange for land having a fair value of $16 million but carried on Rothschild Chair Company’s books at $13 million. 2. First Lincoln Bank agreed to (a) forgive the interest accrued from last year, (b) reduce the remaining four…
At January 1, 2021, Rothschild Chair Company, Inc., was Indebted to First Lincoln Bank under a $20 million, 10% unsecured note. The note was signed January 1, 2018, and was due December 31, 2024. Annual interest was last pald on December 31, 2019. Rothschild Chair Company was experiencing severe financial difficulties and negotiated a restructuring of the terms of the debt agreement. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) (Use approprlate factor(s) from the tables provlded.) Check my work Required: Prepare all journal entries by Rothschild Chair Company, Inc., to record the restructuring and any remaining transactions relating to the debt under each of the independent circumstances below: 1. First Lincoln Bank agreed to settle the debt in exchange for land having a fair value of $16 million but carried on Rothschild Chair Company's books at $13 million. 2. First Lincoln Bank agreed to (a) forgive the interest accrued from last year, (b) reduce the…
At January 1, 2024, Clayton Hoists Incorporated owed Third BancCorp $20 million, under a 10% note due December 31, 2025. Interest was paid last on December 31, 2022. Clayton was experiencing severe financial difficulties and asked Third BancCorp to modify the terms of the debt agreement. After negotiation Third BancCorp agreed to do the following: Note: Use appropriate factor(s) from the tables provided. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) • Forgive the interest accrued for the year just ended. • Reduce the remaining two years' interest payments to $1 million each. • Reduce the principal amount to $19 million. Required: 1-3. Prepare the journal entries by Third BancCorp necessitated by the restructuring of the debt at January 1, 2024, December 31, 2024 and December 31, 2025. Note: Enter your answers in whole dollars. If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Round your final answers…
At January 1, 2018, NCI Industries, Inc., was indebted to First Federal Bank under a $240,000, 10% unsecurednote. The note was signed January 1, 2014, and was due December 31, 2019. Annual interest was last paid onDecember 31, 2016. NCI was experiencing severe financial difficulties and negotiated a restructuring of the termsof the debt agreement. First Federal agreed to reduce last year’s interest and the remaining two years’ interestpayments to $11,555 each and delay all payments until December 31, 2019, the maturity date.Required:Prepare the journal entries by NCI Industries, Inc., necessitated by the restructuring of the debt at: (1) January 1,2018; (2) December 31, 2018; and (3) December 31, 2019.
The balance sheet for Ivanhoe Company reports the following information on July 1, 2022. IVANHOE COMPANYBalance Sheet (partial) Long-term liabilities Bonds payable $400,000 Less: Discount on bonds payable 9,000 $391,000 Ivanhoe decides to redeem these bonds at 109 after paying annual interest.Prepare the journal entry to record the redemption on July 1, 2022. (Credit account titles are automatically indented when amount is entered. Do not indent manually.) Date Account Titles and Explanation Debit Credit July 1 enter an account title enter a debit amount enter a credit amount enter an account title enter a debit amount enter a credit amount enter an account title enter a debit amount enter a credit amount enter an account title enter a debit amount enter a credit amount

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