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90% interest Peregrine Corporation acquired Corporation in 2004 at a time when Cliff's book values and fair values were equal to one another. On January 1, 2005, cliff sold a truck with a $45,000 book value to Peregrine for $90,000. Peregrine is depreciating the truck over 10 years using the straight-line method. Separate incomes for Peregrine and Cliff for 2005 were as follows: Peregrine cliff Sales $ 1,800,000 $ 1,050,000 45,000 Gain on sale of truck Cost of Goods Sold (750,000) (285,000)

90% interest Peregrine Corporation acquired Corporation in 2004 at a time when Cliff's book values and fair values were equal to one another. On January 1, 2005, cliff sold a truck with a $45,000 book value to Peregrine for $90,000. Peregrine is depreciating the truck over 10 years using the straight-line method. Separate incomes for Peregrine and Cliff for 2005 were as follows: Peregrine cliff Sales $ 1,800,000 $ 1,050,000 45,000 Gain on sale of truck Cost of Goods Sold (750,000) (285,000)

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Compute for the Investment income from Cliff.

Peregrine Corporation acquired a 90% interest in cliff Corporation in 2004 at a time when Cliff's book values and fair values were equal to one another. On January 1, 2005, cliff sold a truck with a $45,000 book value to Peregrine for $90,000. Peregrine is depreciating the truck over 10 years using the straight-line method. Separate incomes for Peregrine and Cliff for 2005 were as follows: cliff Peregrine 1,800,000 $ 1,050,000 Sales 45,000 Gain on sale of truck Cost of Goods Sold Depreciation expense Other expenses Separate incomes ( 750,000) ( 450,000) 180,000) 420,000 $ ( 285,000) ( 135,000) (450,000) 225,000 -0) $ S
Transcribed Image Text:Peregrine Corporation acquired a 90% interest in cliff Corporation in 2004 at a time when Cliff's book values and fair values were equal to one another. On January 1, 2005, cliff sold a truck with a $45,000 book value to Peregrine for $90,000. Peregrine is depreciating the truck over 10 years using the straight-line method. Separate incomes for Peregrine and Cliff for 2005 were as follows: cliff Peregrine 1,800,000 $ 1,050,000 Sales 45,000 Gain on sale of truck Cost of Goods Sold Depreciation expense Other expenses Separate incomes ( 750,000) ( 450,000) 180,000) 420,000 $ ( 285,000) ( 135,000) (450,000) 225,000 -0) $ S
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