Effect on consolidated net income of acquisition of affiliate's debt from non-affiliate A Parent Company owns 100 percent of its Subsidiary. During 2018, the Parent company reports net income (by itself, without any investment income from its Subsidiary) of $1,050,000 and the subsidiary reports net income of $420,000. The parent had a bond payable outstanding on December 31, 2018, with a carrying value equal to $882,000. The Subsidiary acquired the bond on December 31, 2018 for $829,500. During 2018, the Parent reported interest expense (related to the bond) of $73,500 while the Subsidiary reported no interest income (related to the bond). What is consolidated net income for the year ended December 31, 2018? $1,543,500 $1,470,000 $1,596,000 $1,522,500
Effect on consolidated net income of acquisition of affiliate's debt from non-affiliate
A Parent Company owns 100 percent of its Subsidiary. During 2018, the Parent company reports net income (by itself, without any investment income from its Subsidiary) of $1,050,000 and the subsidiary reports net income of $420,000. The parent had a bond payable outstanding on December 31, 2018, with a carrying value equal to $882,000.
The Subsidiary acquired the bond on December 31, 2018 for $829,500. During 2018, the Parent reported interest expense (related to the bond) of $73,500 while the Subsidiary reported no interest income (related to the bond). What is consolidated net income for the year ended December 31, 2018?
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