30. T Corp owns 70% of the outstanding stock of S, Inc. On Jan 1, 2019, T acquired an

equipment with a 5-year life for $230,000. T depreciated the equipment on a straight-line bi

assuming no salvage value. On January 1, 2021, T sold the equipment (with eight years of

remaining life and no salvage value) to S for $200,400. How does this transfer affect the

computation of the consolidated net income for 2021?

A. Net income is reduced by $62,400.

B. Net income is reduced by $59,440.

C. Net income is reduced by $70,400.

D. Net income is reduced by $54,600.

E. None of the above.