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Mulan owns 90% of China. On January 1, 2016, China Company sold equipment costing $100,000 to Mulan for $160,000. The equipment has a 10 year

Mulan owns 90% of China. On January 1, 2016, China Company sold equipment costing $100,000 to Mulan for $160,000. The equipment has a 10 year life. Both firms use straight line depreciation. During 2016, China reported $200,000 net income. Based on this information, which of the following investment entries should Palm make in 2016?

$120,000

$126,000

$131,400

$180,000

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