Pluto Corporation owns 70 percent of Saturn Company's stock.On July 1,20X4,Pluto sold a piece of equipment to Saturn for $56,350.Pluto had purchased this equipment on January 1,20X1,for $63,000.The equipment's original 15-year estimated total economic life remains unchanged.Both companies use straight-line depreciation.The equipment's residual value is considered negligible.
-Based on the information provided,in the preparation of the 20X5 consolidated income statement,depreciation expense will be
A) debited for $350 in the consolidation entries.
B) credited for $350 in the consolidation entries.
C) debited for $700 in the consolidation entries.
D) credited for $700 in the consolidation entries.
Correct Answer:
Verified
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