Preston Recognition upon initial consolidation of a variable interest entity (VIE) when Vis is not a business Assume that prior to January 1, 2019, a Reporting Company owned a 15 percent interest in a Legal Entity. The Reporting Company acquired is 15 percent ownership interest in the Legal Entity on June 15, 1998 for $45.000, and correctly accounted for this investment under the cost method fie. It was a passive investment and it was not marketable on january 1 2019 the Reporting Company purchased an additional 30 percent interest in the legal Entity for $180,000. As a result of an evaluation of the facts and circumstances on January 1, 2019, the Reporting Entity determine that the legal Entity is a variable interest entity (VIE) and that the Reporting Company is the primary beneficiary of the VIE The Reporting company ho determined that on January 1, 2019. the far value of the previously held 15 percent interest is $90,000. In addition, independent appraisals revealed that the fair value of the noncontroling interestfie, the 55 percent not owned by the Reporting Company is 5330,000. On January 1, 2019, the legal entity has reported book values for as identifiable net assets equal to 399.000 and fair values for its identifiable net assets equal to $570,000 Assume that the Legal Entity is not a business, as that term is defined in FASE ASC 805 ("Business Combinations"), Reed to the initial consolidation of the Legal Entity on Januay 1, 2019, determine the following amounts Note: Use a negative sign with your answer in part b, to indicate-2.sain on initial consolidation of tegal Entity, if applicable. Account a. Goodwill (Gain) Loss on balconsolidation of Lattity 3 Amount 39,000 X 304,000 K Check Question 4 Partially correct Mark 1.00 out of 4.00 P Flag question Consolidated amounts when affiliate's debt is acquired from non-affiliate Assume that a Parent company owns 100 percent of its Subsidiary. On December 31, 20 The bond was originally issued to an unaffiliated company. On that same date, the Subsi consolidation) income from its own operations (i.e., prior to any equity method adjustme consolidation) income from its own operations. Related to the bond during 2019, the par 31, 2019 recorded interest income of $67,500. Determine the following amounts that will appear in the 2019 consolidated income state Note: Use a negative sign with your answer to indicate a loss on constructive retirement Account Amount a. Interest income from bond investment 0 b. Interest expense on bond payable $ 24,000 x C. Gain (Loss) on constructiveretirement of bond payable. $ 0X d. Consolidate net income $ 304,000 X $ Check Der 31, 2019, the Parent company had a $600,000 (face) bond payable outstanding with a carrying value of $630,000. the Subsidiary acquired the bond for $594,000. During 2019, the Parent company reported $270,000 of (pre- adjustments by the Parent company) and after recording interest expense. The Subsidiary reported $150,000 of (pre. 19, the parent reported interest expense of $67,500. The unaffiliated company that held the bond prior to December come statement: retirement of bond payable, if applicable