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On January 1, 2017, a subsidiary sold equipment to its parent for $520,000. The subsidiary's original cost was $200,000 and as of January 1, 2017, $20,000 in depreciation had been recorded on the subsidiary's books. At the date of sale, the equipment had a 10-year remaining life, straight-line. It is now December 31, 2021 (5 years since the sale), and the parent still holds the equipment.
-In the consolidation eliminating entries for 2021, the accumulated depreciation account is reduced by a net amount of

Question

Use the following information to answer bellow Questions 
On January 1, 2017, a subsidiary sold equipment to its parent for $520,000. The subsidiary's original cost was $200,000 and as of January 1, 2017, $20,000 in depreciation had been recorded on the subsidiary's books. At the date of sale, the equipment had a 10-year remaining life, straight-line. It is now December 31, 2021 (5 years since the sale), and the parent still holds the equipment.
-In the consolidation eliminating entries for 2021, the accumulated depreciation account is reduced by a net amount of

Quizplus · Accepted Answer

[($520,000/10) x 5] - {$20,000 + [[($200,000 - $20,000)/10] x 5]} = $150,000
or $(136,000) + $20,000 - $34,000 = $(150,000)
 11ee52c7_4d2f_7814_90ce_5712524321f1_TBCB1002_00

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