Cairns owns 75 percent of the voting stock of Hamilton, Inc. The parent's interest was acquired several years ago on the date that the subsidiary was formed. Consequently, no goodwill or other allocation was recorded in connection with the acquisition. Cairns uses the equity method in its internal records to account for its investment in Hamilton. On January 1, 2014, Hamilton sold $1,400,000 in 10-year bonds to the public at 110. The bonds had a cash interest rate of 7 percent payable every December 31. Cairns acquired 35 percent of these bonds at 92 percent of face value on January 1, 2016. Both companies utilize the straight-line method of amortization. Prepare the consolidation worksheet entries to recognize the effects of the intra-entity bonds at each of the following dates. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) a. December 31, 2016 b. December 31, 2017 c. December 31, 2018 No Credit 1 Answer is complete but not entirely correct. Date Accounts Debit December 31, 20 Bonds payable 595,000 $ Interest income 62,475 Premium on bonds payable 20,825 Gain on retirement of bonds Interest expense Investment in bonds 136,000 36,325 485,775 % 2 595,000 62,475 17,850 December 31, 20 Bonds payable Interest income Premium on bonds payable Interest expense Investment in Hamilton Investment in bonds >> 56,525 130,050 488,750 3 595,000 62,475 % 14,875 December 31, 20 Bonds payable Interest income Premium on bonds payable Investment in Hamilton Interest expense Investment in bonds 124,100 56,525 491,725 %