At December 31, 2020, Oscar Ltd. owes Wilde Corp. for a $ 300,000 note payable, plus accrued interest of $ 27,000. Oscar is now in financial difficulty and cannot repay Wilde. To settle the debt, Wilde agrees to accept from Oscar equipment with a fair value of $ 285,000, an original cost of $ 420,000, and accumulated depreciation to date of $ 98,000.

Required:

1. Prepare the journal entry on Oscar's books to record the settlement of the debt.

2. Prepare the journal entry on Wildes books to record the settlement of the debt.