Question
On 1/1/2016, there was a loan owed by the Coast Industrial Company for the benefit of the Jordan Islamic Bank, amounting to one million dinars,
On 1/1/2016, there was a loan owed by the Coast Industrial Company for the benefit of the Jordan Islamic Bank, amounting to one million dinars, and there were accrued interests on the loan that were unpaid for two years, amounting to 180,000 dinars. In view of the financial difficulties faced by the Coast Company, it was agreed on this date between the company and the Bank on the following: 1. The bank waives the accrued and unpaid interests amounting to 180,000 dinars. 2. The bank will waive the amount of 200,000 dinars from the original loan 3. The current interest rate on the loan, which is 8% annually, is reduced to 6% annually. Note that the market interest rate (effective on this type of loan is History 9% per year. 4. The loan repayment date is extended to 12/31/2020, noting that the repayment date before the extension was 12/31/2018. Required: 1. Proof of the journal entry for the loan restructuring. 2. Proof of journal entry for interest payment on 12/31/2016
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