Purse Corporation owns 70 percent of Scarf Company's voting shares. On January 1, 20X3, Scarf sold bonds with a par value of $675,000 at 98. Purse purchased $450,000 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. Required: a. What amount of interest expense should be reported in the 20X4 consolidated income statement? (Do not round your intermediate calculations. Round your final answer to nearest whole dollar.) b. Prepare the journal entries Purse recorded during 20X4 with regard to its investment in Scarf bonds. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Do not round your intermediate calculations. Round your final answers to nearest whole dollar.) 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. Do not round your intermediate calculations. Round your final answers to nearest whole dollar.) No 1 2 3 No A Date January 1, 20X4 B July 1, 20X4 Cash Event 1 Interest receivable December 31, 20x Interest receivable 2 Cash Investment in Scarf Company bonds Interest income General Journal Investment in Scarf Company bonds Interest income Interest payable Bonds payable Interest income Investment in Scarf Company bonds Bond discount Interest expense Interest receivable Show Transcribed Text J ✔ ✔ 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. Do not round your intermediate calculations. Round your final answers to nearest whole dollar.) ✔ ✔ → ✪ ✔ ✔ Answer is not complete. Accounts C Debit 18,000 18,000✔ 18,000 Credit 43 44433 18,000 Debit 450,000✔ 18,000 Credit 18,000