Show all work please

1. Choco owns 70% of Cake. On 1/1/2015, Cake issued $800,000 10 years bond at 6%. Cake issued the bond at $724,000, with effective interest of 7%. On 1/1/2016, Choco purchased all of Cakes bond for $886,000 with effective interest at 5% and Cakes bond has been effectively retired.

1. What is the book value of Cakes bond as of 12/31/2015?

   Date	Cash Interest	Effective interest	Amortization of bond discount	BV
   01/01/2015
   12/31/2015
   12/31/2016

2. Calculate the amount of gain or loss from this transaction to be recognized in consolidated statements on 12/31/2016.

1. Make a journal entry that Choco will record regarding the 1/1/2016 investment on bond, and bond interest expense on 12/31/2016.

1/1/16
12/31/16

1. Prepare consolidation entry B on 12/31/2016.