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At January 1, 2021, Brainard Industries, Inc., owed Second BancCorp $19 million under a 10% note...

Question:

At January 1, 2021, Brainard Industries, Inc., owed Second BancCorp $19 million under a 10% note due December 31, 2023. InterAt January 1, 2021, Brainard Industries, Inc., owed Second BancCorp $19 million under a 10% note due December 31, 2023. InterAt January 1, 2021, Brainard Industries, Inc., owed Second BancCorp $19 million under a 10% note due December 31, 2023. InterAt January 1, 2021, Brainard Industries, Inc., owed Second BancCorp $19 million under a 10% note due December 31, 2023. Inter

At January 1, 2021, Brainard Industries, Inc., owed Second BancCorp $19 million under a 10% note due December 31, 2023. Interest was paid last on December 31, 2019. Brainard was experiencing severe financial difficulties and asked Second BancCorp to modify the terms of the debt agreement. After negotiation Second BancCorp agreed to: a. Forgive the interest accrued for the year just ended. 6. Reduce the remaining two years' interest payments to $1 million each and delay the first payment until December 31, 2022. c. Reduce the unpaid principal amount to $18 million. Required: Prepare the journal entries by Brainard Industries, Inc., necessitated by the restructuring of the debt at (1) January 1, 2021: (2) December 31, 2022; and (3) December 31, 2023. (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.) View transaction list Journal entry worksheet < 1 2 3 4 Record the restructuring of the debt on January 1, 2021. Note: Enter debits before credits General Journal Debit Credit Date January 01. 2021 Record entry Clear entry View general journal
At January 1, 2021, Brainard Industries, Inc., owed Second BancCorp $19 million under a 10% note due December 31, 2023. Interest was paid last on December 31, 2019. Brainard was experiencing severe financial difficulties and asked Second BancCorp to modify the terms of the debt agreement. After negotiation Second BancCorp agreed to: a. Forgive the interest accrued for the year just ended. b. Reduce the remaining two years' interest payments to $1 million each and delay the first payment until December 31, 2022. c. Reduce the unpaid principal amount to $18 million. Required: Prepare the journal entries by Brainard Industries, Inc., necessitated by the restructuring of the debt at (1) January 1, 2021: (2) December 31, 2022; and (3) December 31, 2023. (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.) View transaction list Journal entry worksheet Record the scheduled interest cash payment. Note: Enter debits before credits. General Journal Debit Credit Date December 31. 2022 Record entry Clear entry View general journal
At January 1, 2021, Brainard Industries, Inc., owed Second BancCorp $19 million under a 10% note due December 31, 2023. Interest was paid last on December 31, 2019. Brainard was experiencing severe financial difficulties and asked Second BancCorp to modify the terms of the debt agreement. After negotiation Second BancCorp agreed to: a. Forgive the interest accrued for the year just ended. b. Reduce the remaining two years' interest payments to $1 million each and delay the first payment until December 31, 2022. C. Reduce the unpaid principal amount to $18 million. Required: Prepare the journal entries by Brainard Industries, Inc., necessitated by the restructuring of the debt at (1) January 1, 2021: (2) December 31, 2022; and (3) December 31, 2023. (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.) View transaction list Journal entry worksheet < 1 2 34 Record the scheduled interest cash payment. Note: Enter debits before credits. Date General Journal Debit Credit December 31. 2023 Record entry Clear entry View general journal
At January 1, 2021, Brainard Industries, Inc., owed Second BancCorp $19 million under a 10% note due December 31, 2023. Interest was paid last on December 31, 2019. Brainard was experiencing severe financial difficulties and asked Second BancCorp to modify the terms of the debt agreement. After negotiation Second BancCorp agreed to: a. Forgive the interest accrued for the year just ended. b. Reduce the remaining two years' interest payments to $1 million each and delay the first payment until December 31, 2022. C. Reduce the unpaid principal amount to $18 million. Required: Prepare the journal entries by Brainard Industries, Inc., necessitated by the restructuring of the debt at (1) January 1, 2021: (2) December 31, 2022; and (3) December 31, 2023. (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.) View transaction list Journal entry worksheet < 1 2 3 Record the payment of the debt at maturity. Note: Enter debits before credits. Date General Journal Debit Credit December 31. 2023 Record entry Clear entry View general journal

Answers

Answer -
Journal of Brainard Industries, Inc.
Date Particulars Debit ($) Credit ($)
a) January 1, 2021 Interest payable (10% * $19 million) $    19,00,000 -
Notes payable ($18 million-$19 million) - $   10,00,000
Gain on troubled debt restructuring - $     9,00,000
b) December 31, 2022 Notes payable $    10,00,000 -
Cash (Revised interest amount) - $   10,00,000
c) December 31, 2023 Notes payable $    20,00,000 -
Cash (Revised interest amount) - $   20,00,000
December 31, 2023 Notes payable $ 1,80,00,000 -
Cash (Revised Principal amount) - $1,80,00,000
.

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