Sounds like Eyexer(aka eyewear) has a good handle on what's going on. If you have more questions I'd PM red eyed devil. I havnt seen him on here in awhile but he was a huge help when I had to get a new unit a couple years ago.
make sure you know if the wall is bearing before you go hacking away at the top plate and never cut a floor joist unless you know how to reinforce or header it off properly.