A. Record the entry to eliminate the effects of the intercompany ownership in bonds for 20X8.

B. Record the entry to eliminate the intercompany interest receivables/payables for 20X8.

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Par Corporation holds 60 percent of Short Publishing Company's voting shares. Par issued $590,000 of 8 percent bonds with a 10-year maturity on January 1, 20X2, at 94. On January 1, 20X8, Short purchased $118,000 of the Par bonds for $124,000. Partial trial balances for the two companies on December 31, 20X8, are as follows: Note: Assume using straight-line amortization of bond discount or premium. Investment in Short Publishing Company Stock Investment in Par Corporation Bonds Bonds Payable Discount on Bonds Payable Interest Expense Interest Income Interest Payable Interest Receivable Par Corporation $136,000 590,000 10,000 59,000 26,000 Short Publishing Company $123,500 9,400 4,720 Required: Prepare the worksheet consolidation entry or entries needed on December 31, 20X8, to remove the effects of the intercorporate bond ownership in preparing consolidated financial statements. (If no entry is required for a transaction/event, select "No Journal entry required" In the first account fleld.) Par Corporation holds 60 percent of Short Publishing Company's voting shares. Par issued $590,000 of 8 percent bonds with a 10-year maturity on January 1, 20X2, at 94. On January 1, 20X8, Short purchased $118,000 of the Par bonds for $124,000. Partial trial balances for the two companies on December 31, 20X8, are as follows: Note: Assume using straight-line amortization of bond discount or premium. Investment in Short Publishing Company Stock Investment in Par Corporation Bonds Bonds Payable Discount on Bonds Payable Interest Expense Interest Income Interest Payable Interest Receivable Par Corporation $136,000 590,000 10,000 59,000 26,000 Short Publishing Company $123,500 9,400 4,720 Required: Prepare the worksheet consolidation entry or entries needed on December 31, 20X8, to remove the effects of the intercorporate bond ownership in preparing consolidated financial statements. (If no entry is required for a transaction/event, select "No Journal entry required" In the first account fleld.)

Answer rating: 100% (QA)

A Entry to eliminate the effects of the intercompany ownership in bonds for 20X8 Calculate the carry... View the full answer