Ralph has experienced financial difficulties as a result of his struggling business. he has been behind on his mortgage payments for the last six months. the mortgage holder, who is a friend of ralph's, has offered to accept $80,000 in full payment of the $100,000 owed on the mortgage and payable over the next 10 years. the interest rate of the mortgage is 7% and the market rate is now 8%. what tax issues are raised by the creditor's offer?

Mesa company produces wooden rocking chairs. the company has two production departments, cutting and assembly. the wood is cut and sanded in cutting and then transferred to assembly to be assembled and painted. from assembly, the chairs are transferred to finished goods inventory and then are sold.mesa has compiled the following information for the month of february: cutting department assemblydepartmentdirect materials $ 73,000 $ 13,000direct labor 73,000 108,000applied manufacturing overhead 159,000 171,000cost of goods completed and transferred out 233,000 255,000required: 1, 2, 3, & 4. prepare journal entries for the transactions in the cutting and assembly departments of mesa company. (if no entry is required for a transaction/event, select "no journal entry required" in the first account field.)