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The bank forgave the overdue interest payment from 2017.
The terms of the agreement were:
Company Z incurred $10,000 of legal fees to negotiate the restructuring of the note.
Instructions:
Problem 1. Explain how the legal costs associated with the troubled debt restructuring should be recorded. Please provide the appropriate reference from the FASB Codification.the codification section(s). Show the citation and explain in own words.
Problem 2. Prepare the journal entry for January 3, 2018, if any. No codification references are required.
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