Reference no: EM132086339
Question: Wood Corporation owns 1 percent of Carter Company's voting shares. On January 1, 20X3, Carter sold bonds with a par value of $705,000 at 98. Wood purchased $470,000 par value of the bonds; the remainder was sold to nonaffiliates. The bonds mature in five years and pay an annual interest rate of 8 percent. Interest is paid semiannually on January 1 and July 1.
a. cjournal entries Wood recorded during 20X4 with regard to its investment in Carter bonds. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Round your market rate of interest to 3 decimals. For example, .0547523 should be rounded to 5.475%)
b1. Record the intrest received on the bonds Jan 01
b2. Record the intrest received on the bonds July 01
b3. Record the intrest received on the bonds December 31
c. Prepare all worksheet consolidation entries needed to remove the effects of the intercorporate bond ownership in preparing consolidated financial statements for 20X4. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Round your market rate of interest to 3 decimals. For example, .0547523 should be rounded to 5.475%)
c1. record the entry to eliminate the effects of the intercompany ownership in the bonds
c2. Record the entry to eliminate the intercompany interest receivables/payables
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