Khan Inc has owned 80 percent of Summerside Limited for many years On January 1, Year 6, Khan paid Summerside $580,000 to acquire equipment that Summerside had purchased on January 1, Year 4, for $634,000 The equipment is expected to have no scrap value and is depreciated over a 15 year useful life Neither company owns any other equipment Khan reported net income of $84,000 for Year 8 and paid dividends of $54,000 Summerside reported net income of $74,000 and paid dividends of $32,000 in Year 8 Required (a) What amounts should be reported on Khan's separate entity financial statements for Year 8 for equipment, accumulated depreciation, depreciation expense and gain on sale of equipment (Leave no cells blank be certain to enter 0 wherever required Round your final answer to nearest whole dollar Omit $ sign in your response ) Equipment $ 580000 Numeric Response 1 Edit Unavailable 580000 correct Accumulated depreciation $ 116000 Numeric Response 2 Edit Unavailable 116000 incorrect Depreciation expense $ 44615 Numeric Response 3 Edit Unavailable 44615 correct Gain on sale of equipment $ 0 Numeric Response 4 Edit Unavailable 0 correct (b) Compute the amount reported as consolidated net income for Year 8 Ignore income taxes (Do not round your intermediate calculations Round your final answer to nearest whole dollar Omit $ sign in your response ) Consolidated net income $ 72000 Numeric Response 5 Edit Unavailable 72000 incorrect (c) This part of the question is not part of your Connect assignment (d) What amounts should be reported on the Year 8 consolidated statements for equipment, accumulated depreciation and depreciation expense (Do not round your intermediate calculations Round your final answer to nearest whole dollar Omit $ sign in your response ) Equipment $ 634000 Numeric Response 6 Edit Unavailable 634000 correct Accumulated depreciation $ 211333 Numeric Response 7 Edit Unavailable 211333 correct Depreciation expense $ 42267 Numeric Response 8 Edit Unavailable 42267 correct

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Khan Inc. has owned 80 percent of Summerside Limited for many years. On January 1, Year 6, Khan paid Summerside $580,000 to acquire equipment that

Khan Inc. has owned 80 percent of Summerside Limited for many years. On January 1, Year 6, Khan paid Summerside $580,000 to acquire equipment that Summerside had purchased on January 1, Year 4, for $634,000. The equipment is expected to have no scrap value and is depreciated over a 15-year useful life. Neither company owns any other equipment.

Khan reported net income of $84,000 for Year 8 and paid dividends of $54,000. Summerside reported net income of $74,000 and paid dividends of $32,000 in Year 8.

Required:

(a) What amounts should be reported on Khan's separate entity financial statements for Year 8 for equipment, accumulated depreciation, depreciation expense and gain on sale of equipment? (Leave no cells blank - be certain to enter "0" wherever required. Round your final answer to nearest whole dollar. Omit $ sign in your response.)


Equipment	$ 580000 Numeric Response 1.Edit Unavailable. 580000 correct.
Accumulated depreciation	$ 116000 Numeric Response 2.Edit Unavailable. 116000 incorrect.
Depreciation expense	$ 44615 Numeric Response 3.Edit Unavailable. 44615 correct.
Gain on sale of equipment	$ 0 Numeric Response 4.Edit Unavailable. 0 correct.

(b) Compute the amount reported as consolidated net income for Year 8. Ignore income taxes. (Do not round your intermediate calculations. Round your final answer to nearest whole dollar. Omit $ sign in your response.)

Consolidated net income $ 72000 Numeric Response 5.Edit Unavailable. 72000 incorrect.

(c) This part of the question is not part of your Connect assignment.

(d) What amounts should be reported on the Year 8 consolidated statements for equipment, accumulated depreciation and depreciation expense? (Do not round your intermediate calculations. Round your final answer to nearest whole dollar. Omit $ sign in your response.)


Equipment	$ 634000 Numeric Response 6.Edit Unavailable. 634000 correct.
Accumulated depreciation	$ 211333 Numeric Response 7.Edit Unavailable. 211333 correct.
Depreciation expense	$ 42267 Numeric Response 8.Edit Unavailable. 42267 correct.