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Pepper Enterprises owns 95 percent of Salt Corporation. On January 1,20X1, Salt issued $260,000 of...

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Accounting

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Pepper Enterprises owns 95 percent of Salt Corporation. On January 1,20X1, Salt issued $260,000 of five-year bonds at 115. Annual interest of 12 percent is paid semiannually on January 1 and July 1. Pepper purchased $160,000 of the bonds on August 31,20X3, at par value. The following balances are taken from the separate 203 financial statements of the two companies:
Note: Assume using straight-line amortization of bond discount or premium.
\table[[,\table[[Pepper],[Enterprises]],\table[[Salt],[Corporation]]],[\table[[Investment in Salt Corporation Bonds]],\table[[$165,700
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