Tag a. How will this bond issue be recorded and accounted for in 20X8 on the separate books of Planes and Sands?

1. The Planes Company owns 100% of the outstanding common stock of the Sands Company. Sands issued $100,000 of face value, 9%, 10-year bonds on January 1, 20X3, for $96,000. The discount is being amortized on a straight-line basis. On…