Accounts

• Accumulated Depreciation - Buildings
• Accumulated Depreciation - Equipment
• Accumulated Depreciation - Machinery
• Allowance for Doubtful Accounts
• Bad Debt Expense
• Bond Interest Payable
• Bonds Payable
• Buildings
• Cash
• Common Shares
• Cost of Goods Sold
• Depreciation Expense
• Equipment
• FV-NI Investments
• FV-OCI Investments
• Gain on Disposal of Buildings
• Gain on Disposal of Equipment
• Gain on Disposal of Machinery
• Gain on Redemption of Bonds
• Gain on Restructuring of Debt
• Gain on Sale of Investments
• Interest Expense
• Interest Income
• Interest Payable
• Interest Receivable
• Inventory
• Investment Property
• Land
• Loss on Disposal of Machinery
• Loss on Redemption of Bonds
• Loss on Retirement of Bonds
• Loss on Restructuring of Debt
• Loss on Sale of Investments
• Machinery
• Modification Gain or Loss
• Mortgage Payable
• No Entry
• Notes Payable
• Notes Receivable
• Sales Revenue
• Unearned Revenue
• Unrealized Gain or Loss
• Unrealized Gain or Loss - OCI

Headlands Limited owes $220,000 to Teal Mountain Inc. on a 10-year, 11% note due on December 31, 2020. The note was issued at par. Because Headlands is in financial trouble, Teal Mountain Inc. agrees to extend the maturity date to December 31, 2022, reduce the principal to $170,000, and reduce the interest rate to 4%, payable annually on December 31. The market rate is currently 4%. Headlands prepares financial statements in accordance with IFRS. Click here to view the factor table PRESENT VALUE OF 1. Click here to view the factor table PRESENT VALUE OF AN ANNUITY OF 1. Using (1) factor tables, (2) a financial calculator, or (3) Excel function PV, prepare the journal entries on Headlands's books on December 31, 2020, 2021, and 2022. (Hint: Refer to Chapter 3 for tips on calculating.) (For calculation purposes, use 5 decimal places as displayed in the factor table provided and round final answers to O decimal places, e.g. 5,275. 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.) Date Account Titles and Explanation Debit Credit