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Sunland Company owes $208,000 plus $18,700 of accrued interest to Coronado State Bank. The debt...

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Accounting

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Sunland Company owes $208,000 plus $18,700 of accrued interest to Coronado State Bank. The debt is a 10- year, 10% note. During 2017, Sunland's business deteriorated due to a faltering regional economy. On December 31, 2017. Coronado State Bank agrees to accept an old machine and cancel the entire debt. The machine has a cost of $405,000, accumulated depreciation of $222,750, and a fair value of $187,000. Prepare journal entries for Sunland Company and Coronado State Bank to record this debt settlement. (If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually.) DebitCredit DateAccount Titles and Explanation Sunland Company (Debtor): No. 1. December 31, 2017 Coronado State Bank (Creditor) 2. December 31, 2017

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