Several years ago, Zack Corporation sold bonds with a face value of $ to the public at a discount. Annual cash interest of percent ie $ was to be paid on this debt. On January Brant Inc., the parent company of Zack Corporation, purchased these bonds on the open market for $Hint: Did Brant purchase the bonds at a discount or a premium? On that date, the bonds had years until maturity and Zack reported the book value of Bonds Payable of $ Assume Brant uses the equity method to internally account for its investment in Zack. Both parties use the straightline method of amortization.

Required:

points Prepare the Bonds Payable amortization table for Zack Corporation for years

points Prepare the Investment in Bonds amortization table for Brant for years

points Prepare the consolidation entry that would be required for these bonds on December

points Prepare the consolidation entry that would be required for these bonds on December Note: Every year since the bond reacquisition, Brant must prepare a consolidation entry. This question asked for the consolidation entry for the year ended December not December

Consider a different scenario as follows. On January Brant purchased these bonds on the open market for $ and the bonds were reported in as Bonds Payable with a book value of $ in Zacks book on the same date. In this scenario, Brant purchased the bonds at a discount and Zack issued the bonds at a premium. Other information remains the same as that in the original problem.

points Prepare the consolidation entry that would be required for these bonds on December

points Prepare the consolidation entry that would be required for these bonds on December