5)Stark Company, a 90% owned subsidiary of Parker, Inc., sold land to Parker on May 1, 2016, for $80,000. The land originally cost Stark $85,000. Stark reported net income of $200,000, $180,000, and $220,000 for 2016, 2017, and 2018, respectively. Parker sold the land it purchased from Stark in 2016 for $92,000 in 2018.

Which of the following will be included in a consolidation entry for 2016? A. Debit loss for $5,000. B. Credit loss for $5,000. C. Credit land for $5,000. D. Debit gain for $5,000. E. Credit gain for $5,000.

6)On November 8, 2017, Power Corp. sold land to Skywalker Co., its wholly owned subsidiary. The land cost $61,500 and was sold to Skywalker for $50,000. From the perspective of the combination, when is the loss on the sale of the land realized? A. Proportionately over a designated period of years. B. When Skywalker Co. sells the land to a third party. C. No loss can be recognized. D. As Skywalker uses the land. E. When Skywalker Co. begins using the land productively.

7)Plo Co. acquired 75% percent of the voting common stock of Supreme Leader Corp. on January 1, 2017. During the year, Plo made sales of inventory to Supreme Leader. The inventory cost Plo $260,000 and was sold to Supreme Leader for $390,000. Supreme Leader still had $60,000 of the goods in its inventory at the end of the year. The amount of unrealized intercompany profit that should be eliminated in the consolidation process at the end of 2017 is A. $15,000. B. $20,000. C. $32,500. D. $30,000. E. $110,000.