10.

Suspect Company Issued $600,000 of 9 percent first mortgage bonds on January 1,201, at 103 . The bonds mature in 20 years and pay interest semlannually on January 1 and July 1. Prime Corporation purchased $400,000 of Suspect's bonds from the original purchaser on December 31,205, for $397,000. Prime owns 60 percent of Suspect's voting common stock. Note: Assume using straight-IIne amortization of bond discount or premlum. Requlred: a. Prepare the worksheet consolidation entry or entrles needed to remove the effects of the intercorporate bond ownership in preparing consolidated financlal statements for 205. (If no entry is requlred for a transaction/event, select "No journal entry required" in the first account fleld.) b. Prepare the worksheet consolidation entry or entrles needed to remove the effects of the intercorporate bond ownership in preparing consolidated financlal statements for 206. (If no entry is requlred for a transaction/event, select "No journal entry required" in the first account fleld.)