Saguaro Inc. owns 80% of Sequoia Inc. On January 1, 2018, Sequoia sign a note and took a loan from Saguaro for the amount of $1,000,000 with an annual interest rate of 8%. No interest payment has been made. To prepare the consolidated financial statement for 2018 which of the following consolidating entry should be made?

		A debit to interest receivable and a credit to interest payable in the amount of $80,000
		A debit to interest expense and a credit to interest income in the amount of $80,000
		No consolidating entry is needed with regard to interest payable and interest receivable.
		A debit to interest income and a credit to interest expense in the amount of $80,000
		No consolidating entry is needed with regard to interest income and expense

ALSO part of the question. which of the following consolidating entry should be made?

		A debit to note payable in the amount of $1,000,000
		A credit to note payable in the amount of $1,000,000
		A debit to note receivable in the amount of $1,000,000
		A credit to note receivable in the amount of $800,000
		A debit to note payable in the amount of $800,000