A parent company acquires a subsidiary on January 1, 2014. The subsidiary's bonds payable (five year remaining life) is undervalued by $5 million at the date of acquisition. Straight-line amortize the premium/discount, and directly adjust bonds payable for premium/discount amortization.

On the consolidation working paper prepared at December 31, 2016 (three years later), eliminating entry (O) includes:

A.A debit to bonds payable of $1,000,000B.A debit to interest expense of $1,000,000C.A credit to bonds payable of $3,000,000D.A credit to interest expense of $2,000,000