On December 31, 2024, Short Co. is in financial difficulty a…
On December 31, 2024, Short Co. is in financial difficulty and cannot pay a note due that day. It is a $2,000,000 note payable to Bryan, Inc. Bryan agrees to reduce the principal balance due to $1,750,000, extend the maturity date to December 31, 2028, and reduce the interest rate to 8% to 6%. Instructions: Prepare entries for the following: The restructure on Short’s books on December 31, 2024. The restructure on Bryan’s books on December 31, 2024. Short’s payment of interest on December 31, 2025. Bryan’s receipt of interest on December 31, 2025.