Business, 30.10.2020 17:30 bunnyqueen124

Consolidated amounts when affiliate's debt is acquired from non-affiliate Assume that a Parent company owns 75 percent of its Subsidiary. On January 1, 2013, the Parent company had a $100,000 (face) 8 percent bond payable outstanding with a carrying value of $96,600. Several years ago, the bond was originally issued to an unaffiliated company for 92 percent of par value. On January 1, 2013, the Subsidiary acquired the bond for $96,000. During 2013, the Parent company reported $400,000 of (pre-consolidation) income from its own operations (i. e., prior to any equity method adjustments by the Parent company) and after recording interest expense. The Subsidiary reported $140,000 of (pre-consolidation) income from its own operations after recording interest income. Related to the bond during 2013, the parent reported interest expense of $8,500 while the subsidiary reported interest income of $9,200. Determine the following amounts that will appear in the 2013 consolidated income statement:

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Consolidated amounts when affiliate's debt is acquired from non-affiliate Assume that a Parent compa...

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