Business, 06.05.2020 00:58, yafavvlala

Assume that a Parent company owns 100% of its Subsidiary. On January 1, 2019, the Parent company had a $1,000,000 (face) bond payable outstanding with a carrying value of $1,080,000. The bond was originally issued to an unaffiliated company. On that same date, the Subsidiary acquired the bond for $996,000. During 2019, the Parent company reported $550,000 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 $480,000 of (pre-consolidation) income from its own operations after recording interest income. Related to the bond during 2019, the parent reported interest expense of $110,000 while the subsidiary reported interest income of $75,000. What amount of consolidated net income will appear in the 2019 consolidated income statements

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Assume that a Parent company owns 100% of its Subsidiary. On January 1, 2019, the Parent company had...