Plug Corporation purchased $$100,000$ par value bonds of its subsidiary, Spark Company, on December $31,20$X$5,$ from Lemon Corporation for $$102,800.$ The $10-$year bonds bear a $9$ percent coupon rate, and Spark originally sold them on January $1,20$X$3,$ to Lemon at $95.$ Interest is paid annually on December $31.$ Plug owns $85$ percent of the stock of Spark.

In preparing the consolidation worksheet at December $31,20$X$6,$ Plug$$s controller made the following entry to eliminate the effects of the intercorporate bond ownership:

Consolidation Worksheet Entries Debit Credit

Bonds Payable $100,000$

Interest Income $8,691$

Retained Earnings, January $15,741$

Noncontrolling Interest $1,013$

Investment in Spark Company Bonds $102,491$

Discount on Bonds Payable $3,535$

Interest Expense $9,419$

Required: