Stellar Company owes $170,000 plus $15,200 of accrued interest to Pearl State Bank. The debt is a 10-year, 10% note. During 2020, Stellar's business deteriorated due to a faltering regional economy. On December 31, 2020, Pearl State Bank agrees to accept an old machine and cancel the entire debt. The machine has a cost of $330,000, accumulated depreciation of $181,500, and a fair value of $152,000. Prepare journal entries for Stellar Company and Pearl State Bank to record this debt settlement. (If no entry is required, select "No Entry" for the account titles and enter Ofor the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually.) No. Date Account Titles and Explanation Debit Credit Stellar Company (Debtor): 1. December 31, 2020 Pearl State Bank (Creditor): 2. December 31, 2020 e Textbook and Media List of Accounts How should Stellar report the following in its 2020 income statement? 1. Gain or loss on the disposition of machine 2. Gain or loss on restructuring of debt Assume that, instead of transferring the machine, Stellar decides to grant 15,000 shares of its common stock ($10 par) which has a fair value of $152,000 in full settlement of the loan obligation. If Pearl State Bank treats Stellar's stock as a trading investment, prepare the entries to record the transaction for both parties. (If no entry is required, select "No Entry" for the account titles and enter O for the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually.) No. Date Account Titles and Explanation Debit Credit Stellar Company (Debtor): 1. December 31, 2020 Pearl State Bank (Creditor): 2. December 31, 2020