KIM CorpOwned a Major Business Building in a Small Canadian City

question 93

Essay

KIM Corp.owned a major business building in a small Canadian city.The building has a
$1,155,000 mortgage that is held by a Canadian financial institution (FI).KIM Corp.has had recent cash flow problems, in part, due to the low vacancy rates in the business buildings.Interest is 15 months in arrears and totals $132,000.After discussions with the FI, they agree to a financial reorganization that results in the FI accepting $800,000 from the shareholders who agree to inject this amount of cash into the business.
Required:
Prepare the journal entry to record the exchange.What is this called?

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Definitions:

Dispute Resolution

The process of resolving disagreements through negotiation, mediation, arbitration, or legal means.

Negotiators

Individuals involved in discussions aimed at reaching an agreement or compromise between two or more parties.

NLRA

The National Labor Relations Act, a foundational statute in United States labor law that protects the rights of employees to organize and to bargain collectively with their employers, and to engage in other protected concerted activities.

Bargaining Process

Negotiations between employers and employee representatives (usually unions) on work conditions, wages, and benefits aiming for a mutual agreement.