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

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Accounting

Pepper Enterprises owns 95 percent of Salt Corporation. On January 1,20X1, Salt issued $200,000 of five-year bonds at 115. Annual interest of 12 percent is paid semiannually on January 1 and July 1. Pepper purchased $100,000 of the bonds on July 1,203, at par value. The following balances are taken from the separate 203 financial statements of the two companies:
\table[[,Pepper Enterprises,Salt Corporation],[Investment in Salt Corporation Bonds,$100,000,],[Interest Income,6,000,],[Interest Receivable,6,000,],[Bonds Payable,,$200,000
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