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On December 31, 2014, Green Bank enters into a debt restructuring agreement with Troubled Inc., which is now experiencing financial trouble. The bank agrees to
On December 31, 2014, Green Bank enters into a debt restructuring agreement with Troubled Inc., which is now experiencing financial trouble. The bank agrees to restructure a $1.10- million, 12% note receivable issued at par by the following modifications:
1. | Reducing the principal obligation from $1.10 million to $0.88 million |
2. | Extending the maturity date from December 31, 2014, to December 31, 2017 |
3. | Reducing the interest rate from 12% to 11% |
Troubled pays interest at the end of each year. On January 1, 2018, Troubled Inc. pays $0.88 million in cash to Green Bank for the principal. The market rate is currently 11%. (Use the below table
Yes their is a gain.
I am unable to calculate the gain. what is the gain amount $?
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