Question 27

QUESTION 27 **************** The following information relates to the next three questions. On December 31, 2021, Betty Wenck is in financial difficulty and cannot pay a note due that day. It is a $1,800,000 note with $180,000 accrued interest payable to Holtkamp Inc. Holtkamp agrees to accept from Wenck equipment that has a FMV of $890,000, an original cost of $1,440,000 and accumulated depreciation of $690,000. Holtkamp also forgives the accrued interest, extends the maturity date to December 31, 2024, reduces the face amount of the note to $750,000, and reduces the interest rate to 6%, with interest payable at the end of the year. Question: Betty Wenck should recognize a gain or loss on the transfer of the equipment (settlement) in the amount of? Put positive number for gain and negative number for loss. QUESTION 28 ******* ***** Wenck should recognize a gain on the restructure of the debt (modification) of: QUESTION 29 ******* **** Betty Wenck should record interest expense for 2024 of