Lewis Company owns 80% of the voting common stock of Sutherland, Inc. On January 1, 2016, Sutherland sold $1,400,000 in ten-year bonds to the public at 105. The bonds pay a 10% interest rate every December 31. Lewis Company acquired 50% of these bonds on January 1, 2018, for 95% of the face value. Both companies utilize the straight-line method of amortization. Lewis Company uses the equity method to maintain its investment account in Sutherland, Inc.

C. Prepare the consolidation entry that would be recorded in connection with these intra-entity bonds on December 31, 2018?

D. Prepare the consolidation entry that would be recorded in connection with these intra-entity bonds on December 31, 2019