Question
Padre Ltd. holds 90 percent of the outstanding shares of Sonora Ltd. On January 1, 2019 , Padre Ltd. transferred equipment to Sonora for $95,000.
Padre Ltd. holds 90 percent of the outstanding shares of Sonora Ltd. On January 1, 2019, Padre Ltd. transferred equipment to Sonora for $95,000. The equipment had cost $130,000 originally but had a $50,000 carrying value and five-year remaining life at the date of transfer. Depreciation expense is computed according to the straight-line method with no residual value.
Required:
What would be the consolidation worksheet entries in relation to this asset when preparing the consolidated financial statements for the following accounting periods ending at (Ignore the tax effect):
31 December 2019
31 December 2020
31 December 2021
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