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Several years ago Brant, Inci, sold $1,020,000 in bonds to the public. Annual cash interest of 8 percent ($81,600) was to be paid on this
Several years ago Brant, Inci, sold $1,020,000 in bonds to the public. Annual cash interest of 8 percent (\$81,600) was to be paid on this debt. The bonds were issued at a discount to yield 10 percent. At the beginning of 2019 . Zack Corporation (a wholly owned subsidlary of Brant) purchased $170,000 of these bonds on the open market for $191,000, a price based on an effective interest rate of 6 percent. The bond liability had a carrying amount on that date of $960,000. Assume Brant uses the equity method to account internally for its investment in Zack. a. \& b. What consolidation entry would be required for these bonds on December 31,2019 and December 31, 2021 ? (If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Round your intermediate calculations and final answers to nearest whole number.) Consolidation Worksheet Entries Prepare Consolidation Entry B to account for these bonds on December 31 , 2019. Note: Enter debits before credits. Dobit
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