h. A partially secured creditor with a debt balance of $120,000 repossessed equipment that served as collateral. The equipment had a book value of $220,000 and accumulated depreciation of $150,000....

h. A partially secured creditor with a debt balance of $120,000 repossessed equipment that served as collateral. The equipment had a book value of $220,000 and accumulated depreciation of $150,000. The remaining $40,000 of debt was to be paid over the next six quarters in equal payments bearing interest at 5.6%, compared to the original rate of 6.4%.

Prepare all of the necessary entries to record the above events (a) through (h). Determine the total amount of interest expense to be recognized in connection with the first quarterly payment associated with the restructured debts.