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At January 1 , 2016, NCI Industries , Inc . was indebted to First Federal Bank under a $240, 000, 10% unsecured note . The
At January 1 , 2016, NCI Industries , Inc . was indebted to First Federal Bank under a $240, 000, 10% unsecured note . The note was signed January 1 , 2014 , and was due December 31, 2017 . Annual interest Was last paid on December 31, 2014. NCI was experiencing severe financial difficulties and negotiated a restructuring of the terms of the debt agreement . First Federal agreed to reduce last year's interest and the remaining two years' interest payments to $1 1, 555 each and delay all payments until December 31 , 2017, the maturity date . Required : Prepare the journal entries by First Federal Bank necessitated by the restructuring of the debt at 1 . January 1, 2016 . 2 . December 31, 2016 . 3. December 31, 2017
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