How to read output of sed into a variable
You can use command substitution as:
new_filename=$(echo "$a" | sed 's/.txt/.log/')
or the less recommended backtick way:
new_filename=`echo "$a" | sed 's/.txt/.log/'`
You can use backticks to assign the output of a command to a variable:
logfile=`echo $a | sed 's/.txt/.log/'`
That's assuming you're using Bash.
Alternatively, for this particular problem Bash has pattern matching constructs itself:
stem=$(textfile%%.txt)logfile=$(stem).log
or
logfile=$(textfile/%.txt/.log)
The % in the last example will ensure only the last .txt is replaced.