Advanced Accounting 10th Edition by Thomas Schaefer, Joe Ben Hoyle, Timothy Doupnik

Exercise 49

Pumpkin Company is going through bankruptcy reorganization.It has a $200,000 note payable incurred prior to the order for relief.The company believes that the note will be settled for $60,000 in cash.It is also possible that the creditor will instead take a piece of land that cost the company $50,000 but is worth $72,000.On a balance sheet during the reorganization period, how will this debt be reported