Sunland Company, which owes Bramble Corp. $4,080,000 in notes payable, is in financial difficulty. To eliminate the debt, Bramble agrees to accept from Sunland land having a fair value of $3,111,000 and a recorded cost of $2,295,000
Compute the amount of gain or loss to Sunland Company on the transfer (disposition) of the land.
GainLoss
on disposal of land
$
Compute the amount of gain or loss to Sunland Company on the restructuring of the debt.
GainLoss
on restructuring of debt
$
Prepare the journal entry on Sunland’s books to record the restructuring of this debt.
Account Titles and Explanation
Debit
Credit
Compute the gain or loss to Bramble Corp. from restructuring of its receivable from Sunland.
GainLoss
on restructured debt
$
Prepare the journal entry on Bramble ‘s books to record the restructuring of this receivable.
Account Titles and Explanation
Debit
Credit
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