Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Grey Corp owns 100%of Blue Company.On January 1,2017Grey sold Blue a machine for $59,317.Immediately prior to the sale,the machine was recorded on Grey's books at
- Grey Corp owns 100%of Blue Company.On January 1,2017Grey sold Blue a machine for $59,317.Immediately prior to the sale,the machine was recorded on Grey's books at a net book value of $23,717.Prior to the sale,Grey was depreciating the machine on a straight-line basis with 8years of remaining life and no salvage value. Blue plans to adopt the same depreciation assumptions as Grey.What elimination adjustments with respect to this sale must be made to consolidated net income in 2018 (ignoringincome tax effects)?
- On January1,2016,Pultesolda building to its wholly owned subsidiary, Scott, for $2,004,491.On that date, Pultecarried the building on its books at an original cost of $677,560 and accumulated depreciation of $391,291.Pultehad estimated 7 years total useful life for the building, and was depreciating it on a straight-line basis with $125,845 estimated salvage value. What net book value for this building should be reported on Pulte'sconsolidated balance sheet as of 12/31/2016?
- Grey Corp owns 100%of Blue Company.On January 1,2017Grey sold Blue a machine for $63,969.Immediately prior to the sale,the machine was recorded on Grey's books at a net book value of $22,246.Prior to the sale,Grey was depreciating the machine on a straight-line basis with 3years of remaining life and no salvage value. Blue plans to adopt the same depreciation assumptions as Grey.What elimination adjustments with respect to this sale must be made to consolidated net income in 2017 (ignoringincome tax effects)?
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started