Lawrence Incorporated owes $100,000 to Ontario Bank Inc. on a two-year, 10% note due on December 31,

Question:

Lawrence Incorporated owes $100,000 to Ontario Bank Inc. on a two-year, 10% note due on December 31, 2014. The note was issued at par. Because Lawrence is in financial trouble, Ontario Bank agrees to extend the maturity date of the note to December 31, 2016, reduce the principal to $75,000, and reduce the interest rate to 8%, payable annually on December 31. Present value of the new debt is calculated as $72,397. Lawrence prepares financial statements in accordance with IFRS. Prepare the journal entry on Lawrence's books on December 31, 2014, 2015, and 2016?

Financial Statements
Financial statements are the standardized formats to present the financial information related to a business or an organization for its users. Financial statements contain the historical information as well as current period’s financial... Maturity
Maturity is the date on which the life of a transaction or financial instrument ends, after which it must either be renewed, or it will cease to exist. The term is commonly used for deposits, foreign exchange spot, and forward transactions, interest...