Advanced Accounting 12th Edition by Joe Ben Hoyle,Thomas Schaefer , Timothy Doupnik

Exercise 23

Dunn Corporation owns 100 percent of Grey Corporation's common stock. On January 2, 2014, Dunn sold to Grey $40,000 of machinery with a carrying amount of $30,000. Grey is depreciating the acquired machinery over a 5-year remaining life by the straight-line method. The net adjustments to compute 2014 and 2015 consolidated net income would be an increase (decrease) of