Question
Stern Manufacturing purchased an ultrasound drilling machine with a remaining 10-year economic life from a 70 percent-owned subsidiary for $360,000 on January 1, 20X6. Both
Stern Manufacturing purchased an ultrasound drilling machine with a remaining 10-year economic life from a 70 percent-owned subsidiary for $360,000 on January 1, 20X6. Both companies use straight-line depreciation. The subsidiary recorded the following entry when it sold the machine to Stern:
General Journal | Debit | Credit | ||
Cash | 360,000 | |||
Accumulated Depreciation | 150,000 | |||
Equipment | 450,000 | |||
Gain on Sale of Equipment | 60,000 | |||
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