Question 49

In 2014, Parla Corporation sold land to its subsidiary, Sidd Corporation, for $38,000. It had a book value of $24,000. In the next year, Sidd sold the land for $41,000 to an unaffiliated firm.

The 2014 unrealized gain from the intercompany sale

	A.	Should be eliminated from consolidated net income by a working paper entry that credits land for $14,000.
	B.	Should be eliminated from consolidated net income by a working paper entry that credits gain on sale of land for $14,000.
	C.	Should be eliminated from consolidated net income by a working paper entry that debits land for $14,000.
	D.	Should be recognized in consolidation in 2014 by a working paper entry.