Saturn Corporation Issued $300,000 Par Value 10-Year Bonds at 107

question 33

Multiple Choice

Saturn Corporation issued $300,000 par value 10-year bonds at 107 on January 1,20X3,which Star Corporation purchased.On July 1,20X7,Pluto Corporation purchased $120,000 face value of Saturn bonds from Star.The bonds pay 12 percent interest annually on December 31.The preparation of consolidated financial statements for Saturn and Pluto at December 31,20X9,required the following consolidation entry:

-Based on the information given above,if 20X9 consolidated net income of $50,000 would have been reported without the consolidation entry provided,what amount will actually be reported?

• A)$47,900
• B)$48,200
• C)$49,400
• D)$48,800

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Definitions:

Breast Tenderness

The sensation of pain or discomfort in the breasts, which can result from hormonal changes, injury, or medical conditions.

Embryo

The first eight weeks of development after fertilization.

Infant

A very young child, especially one newly or recently born, usually considered to be from birth to 1 year old.

Zygote

A cell produced by the union of an ovum and a sperm.