3.ON January 1, 2014, the parent sold new equipment for which it paid $600,000 to the subsidiary for $1,000,000. The plant assets had a remaining life of 10 years at that time, straight-line. The subsidiary still has the equipment at year-end. On the consolidation working paper, the net effect of eliminations I will be a

A. Credit accumulated depreciation for $60,000

B. Credit depreciation expense for $40,000

C. Credit equipment for $600,000

D. Credit gain on sale of equipment for $400,000