1.A parent company acquires all of a subsidiary's voting stock at the beginning of 2015. At the date of acquisition, the subsidiary's equipment had a book value of $40 million and a fair value of $25 million. The equipment had a 10-year remaining life, straight-line.

Consolidation eliminating entry (O), on the consolidation working paper for 2018, has what effect on depreciation expense?

A.Debit for $1.5 millionB.Debit for $6 millionC.Credit for $1.5 millionD.Credit for $6 million

2.A parent company acquires all of a subsidiary's voting stock at the beginning of 2015. At the date of acquisition, the subsidiary's equipment had a book value of $40 million and a fair value of $25 million. The equipment had a 10-year remaining life, straight-line.

Consolidation eliminating entry (R), on the consolidation working paper for 2018, reduces the net equipment account by what amount?

A.$10.5 millionB.$15.0 millionC.$ 9.0 millionD.$17.5 million