Assume that one company in a consolidated group sells a depreciable asset to another party in that group at a gain. The depreciable asset has a remaining life of 5 years. Which of the following statements is true.

answer choices:

A. In the year of the sale, the seller's Net Income will be overstated by the amount of the gain, and this gain will be closed out to their Retained Earnings

B. All of these statements are true.

C. In the year of the sale, the buyer's equipment cost will be overstated by the amount of the gain, as well all future depreciation expense recorded on this equipment.

D. Beginning in Year 6, an adjustment to the beginning balance of Retained Earnings will no longer be required.