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  • Notes Payable & Debt Restructuring - Valix 2020

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    Shinny Jewel Vingno
    592 views6 pages
    The document contains journal entries for several companies. It records transactions such as issuing notes payable, paying interest expense, extinguishing debt, and restructuring debt obligations. The entries show the accounting for these various financing and debt transactions over time.

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    Original Title

    NOTES PAYABLE & DEBT RESTRUCTURING - VALIX 2020

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    The document contains journal entries for several companies. It records transactions such as issuing notes payable, paying interest expense, extinguishing debt, and restructuring debt obligations. The entries show the accounting for these various financing and debt transactions over time.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Flag for inappropriate content
    Download as pdf or txt
    592 views6 pages

    Notes Payable & Debt Restructuring - Valix 2020

    Uploaded by

    Shinny Jewel Vingno
    The document contains journal entries for several companies. It records transactions such as issuing notes payable, paying interest expense, extinguishing debt, and restructuring debt obligations. The entries show the accounting for these various financing and debt transactions over time.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Flag for inappropriate content
    Download as pdf or txt
    of 6

    Shinny Jewel C.

    Vingno
    BSA-2

    Home Company
    1. Cash 5,520,000
    Discount on notes payable 480,000
    Notes Payable 6,000,000

    2. Interest Expense 180,000


    Discount on notes payable 180,000

    3. Current Liability on Dec. 31, 2020

    Notes Payable 6,000,000


    Discount on notes payable (300,000)
    Carrying amount, 12/31/2020 5,700,000

    4. Interest Expense 300,000


    Discount on notes payable 300,000

    Notes Payable 6,000,000


    Cash 6,000,000

    5. Cash 6,000,000
    Notes Payable 6,000,000

    6. Interest Expense 180,000


    Accrued Interest Payable 180,000

    7 Notes Payable 6,000,000


    Interest Expense 300,000
    Cash 6,300,000

    Rose Company
    Feb. 1, 2020 NO ENTRY. Disclosure note is necessary in this event.

    Apr. 1, 2020 Cash 12,000,000


    Notes Payable 12,000,000

    Jul. 1, 2020 Notes Payable 12,000,000


    Interest Expense 240,000
    Cash 12,240,000

    Nov. 1, 2020 Cash 19,100,000


    Discount on notes payable 900,000
    Notes Payable 20,000,000
    Shinny Jewel C. Vingno
    BSA-2

    Dec. 31, 2020 Interest Expense 200,000


    Discount on notes payable 200,000

    Aug. 1,2021 Interest Expense 700,000


    Discount on notes payable 700,000
    Notes Payable 20,000,000
    Cash 20,000,000

    West Company
    Jan. 1, 2020 Land 1,000,000
    Cash 100,000
    Notes Payable 900,000

    Dec. 31, 2020 Interest expense 90,000


    Accrued Interest Payable 90,000

    Dec. 31, 2021 Interest expense 99,000


    Accrued Interest Payable 99,000

    Dec. 31, 2022 Notes Payable 900,000


    Interest expense 189,000
    Cash 1,089,000

    North Company
    Jan. 1, 2020 Machinery 750,000
    Discount on notes payable 250,000
    Cash 200,000
    Notes Payable 800,000

    Dec. 31, 2020 Notes Payable 200,000


    Cash 200,000
    Interest expense 100,000
    Discount on notes payable 100,000

    Rainbow Company
    1. Notes Payable 1,000,000
    Accrued Interest Payable 200,000
    Patent 600,000
    Gain on debt restructuring 600,000
    2. Notes Payable 1,000,000
    Accrued Interest Payable 200,000
    Patent 600,000
    Gain on exchange 500,000
    Gain on debt restructuring 100,000
    Shinny Jewel C. Vingno
    BSA-2
    Fair value 1,100,000
    Carrying amount (600,000)
    Gain on exchange 500,000

    Notes Payable 1,000,000


    Accrued Interest Payable 200,000
    Carrying amount 1,200,000
    Fair value of the Patent (1,100,000)
    Gain on debt restructuring 100,000

    Sunshine Company
    1. Mortgage Payable 4,000,000
    Accrued Interest Payable 300,000
    Loss on extinguishment of debt 250,000
    Share Capital 3,500,000
    Share Premium 1,050,000

    2. Mortgage Payable 4,000,000


    Accrued Interest Payable 300,000
    Loss on extinguishment of debt 200,000
    Share Capital 3,500,000
    Share Premium 1,000,000

    3. Mortgage Payable 4,000,000


    Accrued Interest Payable 300,000
    Share Capital 3,500,000
    Share Premium 800,000

    Quest Company
    1. Notes Payable 5,000,000
    Accrued Interest Payable 400,000
    Ordinary share capital 1,500,000
    Share premium-os 1,500,000
    Preference share 250,000
    share premium - ps 1,250,000
    Gain on extinguishment of debt 900,000

    2. Notes Payable 5,000,000


    Accrued Interest Payable 400,000
    Ordinary share capital 1,500,000
    Share premium-os 1,700,000
    Preference share 250,000
    share premium - ps 1,350,000
    Gain on extinguishment of debt 600,000
    Shinny Jewel C. Vingno
    BSA-2
    Market Value Fraction Issue Price
    Ordinary share capital 3,000,000 3/4.5 3,200,000
    Preference share 1,500,000 1.5/3.5 1,600,000
    4,500,000 4,800,000
    3. Notes Payable 5,000,000
    Accrued Interest Payable 400,000
    Ordinary share capital 1,500,000
    Share premium-os 2,100,000
    Preference share 250,000
    share premium - ps 1,550,000

    Market Value Fraction Issue Price


    Ordinary share capital 3,000,000 3/4.5 3,600,000
    Preference share 1,500,000 1.5/3.5 1,800,000
    4,500,000 5,400,000
    Shinny Jewel C. Vingno
    BSA-2

    Sunrise Company
    1. Notes Payable-old 6,000,000
    Accrued Interest Payable 720,000
    Discount on notes payable 668,338
    Notes Payable-new 4,831,662
    Gain on extinguishment of debt 1,888,338

    PV of Principal (5,500,000*0.6355) 3,495,250


    PV of interest Payment (5,500,000*8%*3.0373) 1,336,412
    PV of new liability 4,831,662
    Face amount of note (5,500,000)
    Discount on notes payable (668,338)

    Notes Payable-old 6,000,000


    Accrued Interest Payable (6,000,000*12%) 720,000
    Carrying amount 6,720,000
    PV of new liability (4,831,662)
    Gain on extinguishment of debt 1,888,338

    2. Interest expense (5,500,000*8%) 440,000


    Cash 440,000

    Interest expense 139,799


    Discount on notes payable 139,799

    Interest paid (5,500,000*8%) 440,000


    Interest expense (4,831,662*12%) 579,799.44
    Discount amortization (139,799)

    Bontoc Company
    1. Notes Payable 500,000
    Discount on notes payable 280,640
    Gain on modification 780,640

    PV of Principal (8,000,000*0.8772) 7,017,600


    PV of interest Payment (8,000,000*10%*0.8772) 701,760
    PV of new liability 7,719,360

    Old Liability 8,500,000


    New (7,719,360)
    Gain on modification of debt 780,640
    Shinny Jewel C. Vingno
    BSA-2

    New notes payable 8,000,000


    PV (7,719,360)
    Discount on notes payable 280,640

    2. Interest Expense 800,000


    Cash 800,000

    Interest Expense 280,640


    Discount on notes payable 280,640

    Notes Payable 8,000,000


    Cash 8,000,000

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