Exercise 14-21 Larkspur Company owes $222,000 plus $20,600 of accrued interest to Cullumber State Bank. The debt is a 10-year, 10% note. During 2017, Larkspur's business deteriorated due to a faltering regional economy. On December 31, 2017, Cullumber State Bank agrees to accept an old machine and cancel the entire debt. The machine has a cost of $344,000, accumulated depreciation of $189,200, and a fair value of $206,000. Prepare journal entries for Larkspur Company and Cullumber State Bank to record this debt settlement. (If no entry is required, select "No Entry" for the account tities and enter for the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually.) Larkspur Company Dear Cube State Bank Credit 2017 2 Dec How should Larkspur report the following in its 2017 income statement? 1. Ganoon the machine