Question
In 2011, ParlaCorporation sold land to its subsidiary, Sidd Corporation, for$38,000. It had a book value of $24,000. In the next year (2012),Sidd sold the
In 2011, ParlaCorporation sold land to its subsidiary, Sidd Corporation, for$38,000. It had a book value of $24,000. In the next year (2012),Sidd sold the land for $41,000 to an unaffiliated firm.
The 2011 unrealizedgain from the intercompany sale:
a. should be eliminatedfrom consolidated net income by a working paper entry that debitsland for $14,000.
b. should be recognizedin consolidation in 2011 by a working paper entry.
c. should be eliminatedfrom consolidated net income by a working paper entry that creditsgain on sale of land for $14,000.
d. should be eliminatedfrom consolidated net income by a working paper entry that creditsland for $14,000.
is the answer A?
In 2011, ParlaCorporation sold land to its subsidiary, Sidd Corporation, for$38,000. It had a book value of $24,000. In the next year (2012),Sidd sold the land for $41,000 to an unaffiliated firm.
The 2011 unrealizedgain from the intercompany sale:
| a. | should be eliminatedfrom consolidated net income by a working paper entry that debitsland for $14,000. | |
| b. | should be recognizedin consolidation in 2011 by a working paper entry. | |
| c. | should be eliminatedfrom consolidated net income by a working paper entry that creditsgain on sale of land for $14,000. | |
| d. | should be eliminatedfrom consolidated net income by a working paper entry that creditsland for $14,000. is the answer A? |
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Accounting Information System
Authors: James A. Hall
7th Edition
978-1439078570, 1439078572
