Ivanhoe Company owes $179,000 plus $15,800 of accrued interest to Shamrock State Bank. The debt is a 10-year, 10% note. During 2020, Ivanhoe’s business deteriorated due to a faltering regional economy. On December 31, 2020, Shamrock State Bank agrees to accept an old machine and cancel the entire debt. The machine has a cost of $336,000, accumulated depreciation of $184,800, and a fair value of $158,000.     Prepare journal entries for Ivanhoe Company and Shamrock State Bank to record this debt settlement.      Assume that, instead of transferring the machine, Ivanhoe decides to grant 12,000 shares of its common stock ($10 par) which has a fair value of $158,000 in full settlement of the loan obligation. If Shamrock State Bank treats Ivanhoe’s stock as a trading investment, prepare the entries to record the transaction for both parties

Holly Springs, Inc. contracted with Coldwater Corporation to have constructed a custom-made lathe. The machine was completed and ready for use on January 1, 2021. Holly Springs paid for the lathe by issuing a $300,000 note due in three years. Interest, specified at 2%, was payable annually on December 31 of each year. The cash market price of the lathe was unknown. It was determined by comparison with similar transactions for which 6% was a reasonable rate of interest. Holly Springs uses the effective interest method of amortization. (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:1. Prepare the journal entry on January 1, 2021, for Holly Springs’ purchase of the lathe.2. Prepare an amortization schedule for the three-year term of the note.3. Prepare the journal entries to record (a) interest for each of the three years and (b) payment of the note at maturity.

On January 1, 2025, Flounder Corporation sold a building that cost $274,530 and that had accumulated depreciation of $105,600 on the date of sale. Flounder received as consideration a $264,530 non-interest-bearing note due on January 1, 2028. There was no established exchange price for the building, and the note had no ready market. The prevailing rate of interest for a note of this type on January 1, 2025, was 9%. At what amount should the gain from the sale of the building be reported? (Round factor values to 5 decimal places, e.g. 1.25124 and final answer to 0 decimal places, e.g. 458,581.) The amount of gain should be reported (b) Your answer is incorrect. $ Flounder must pay for the bonds 35335 On January 1, 2025, Flounder Corporation purchased 349 of the $1,000 face value, 9%, 10-year bonds of Walters Inc. The bonds mature on January 1, 2035, and pay interest annually beginning January 1, 2026. Flounder purchased the bonds to yield 11%. How much did Flounder pay for the bonds?…

Maris Co. purchased a machine on January 1, 2021, for $2,500,000 for the express purpose of leasing it. The machine is expected to have a five-year life, with no salvage value, and be depreciated on a straight-line monthly basis. On January 1, 2021, Maris leased the machine to Dunbar Company for $750,000 a year for a four-year period with an implicit rate of 6%. Payments are due to Maris on January 1 of each year starting in 2021. This is an operating lease from the lessee perspective.    a. Create the journal entries for the lessee, Dunbar, for January 1, 2021 b. Create the journal entries for the lessee, Dunbar, for December 31, 2021.

Kingbird Corp. sells idle machinery to Enyart Company on July 1, 2020, for $46,000. Kingbird agrees to repurchase this equipment from Enyart on June 30, 2021, for a price of $49,680 (an imputed interest rate of 8%). (a) Prepare the journal entry for Kingbird for the transfer of the asset to Enyart on July 1, 2020. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No entry" for the account titles and enter O for the amounts.) Account Titles and Explanation Debit Credit eTextbook and Media

Bonita Company owes $167,000 plus $14,900 of accrued interest to Windsor State Bank. The debt is a 10-year, 10% note. During 2020, Bonita's business deteriorated due to a faltering regional economy. On December 31, 2020, Windsor State Bank agrees to accept an old machine and cancel the entire debt. The machine has a cost of $322,000, accumulated depreciation of $177,100, and a fair value of $149,000. (a) Prepare journal entries for Bonita Company and Windsor State Bank to record this debt settlement. (If no entry is required, select "No Entry" for the account titles and enter O for the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually.) Date December 31, 2020 Account Titles and Explanation Bonita Company (Debtor): Notes Payable Interest Payable Debit 167,000 14,900 Credit

Pharoah Inc. owes Waterway Bank $166,000 plus $16,300 of accrued interest. The debt is a 10-year, 10% note. During 2023, Pharoah's business declined due to a slowing regional economy. On December 31, 2023, the bank agrees to accept an old machine and cancel the entire debt. The machine has a cost of $302,000, accumulated depreciation of $185,000, and a fair value of $146,000. The bank plans to dispose of the machine at a cost of $6,000. Both Pharoah and Waterway Bank prepare financial statements in accordance with IFRS 9. (a) Prepare the journal entries for Pharpah and Waterway Bank to record this debt settlement. Assume Waterway Bank had previously recognized an allowance for doubtful accounts for the impairment prior to the settlement. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts. List all debit entries before credit entries.) Date…

On April 1, 2024, Washtenaw Corporation realizes that one of its main suppliers is having difficulty meeting delivery schedules, which is hurting Washtenaw's business. The supplier explains that it has a temporary lack of funds that is slowing its production cycle. Washtenaw agrees to lend $480,000 to its supplier using a 12-month, 12% note. Required: Record the following transactions for Washtenaw Corporation: 1. The loan of $480,000 and acceptance of the note receivable on April 1, 2024. 2. The adjusting entry for accrued interest on December 31, 2024. 3. Cash collection of the note and interest on April 1, 2025. (If no entry is required for a particular transaction/event, select "No Journal Entry Required" in the first account field.) View transaction list Journal entry worksheet 1 Record the loan of $480,000 and acceptance of the note receivable on April 1, 2024. 2 Note: Enter debits before credits. Date April 01, 2024 Record entry Credit > View general journal

On January 1, 2019, Worthylake Company sold used machinery to Brown Company, accepting a $25,000, non-interest-bearing note maturing on January 1, 2021. Worthylake carried the machinery on its books at a cost of $22,000 and a current book value of $15,000. Neither the fair value of the machinery nor the note was determinable at the time of sale; however, Brown’s incremental borrowing rate was 12%. Required:   Prepare the journal entries on Worthylake’s books to record:   1. sale of the machinery 2. related adjusting entries on December 31, 2019, and 2020 3. payment of the note by Brown on January 1, 2021

On January 1, 2025, Sarasota Corporation sold a building that cost $273,840 and that had accumulated depreciation of $109,280 on the date of sale. Sarasota received as consideration a $263,840 non-interest-bearing note due on January 1, 2028. There was no established exchange price for the building, and the note had no ready market. The prevailing rate of interest for a note of this type on January 1, 2025, was 9%. At what amount should the gain from the sale of the building be reported? (Round factor values to 5 decimal places, e.g. 1.25124 and final answer to 0 decimal places, e.g. 458,581.) The amount of gain should be reported $