Falcon Corporation sold equipment to its 80%-owned subsidiary, Rodent Corp., on January 1, 2005. Falcon sold the equipment for $110,000 when its book value was $85,000 and it had a 5- year remaining useful life with no expected salvage value. Separate balance sheets for Falcon and Rodent included the following equipment and accumulated depreciation amounts on December 31, 2005: Falcon Rodent Equipment $ 750,000 $ 300,000 Less: Accumulated depreciation (200,000) 550,000 Equipment-net $ 250,000 Consolidated amounts for equipment and accumulated depreciation. at December 31, 2005 were respectively ՄԴ $ 50,000)
Falcon Corporation sold equipment to its 80%-owned subsidiary, Rodent Corp., on January 1, 2005. Falcon sold the equipment for $110,000 when its book value was $85,000 and it had a 5- year remaining useful life with no expected salvage value. Separate balance sheets for Falcon and Rodent included the following equipment and accumulated depreciation amounts on December 31, 2005: Falcon Rodent Equipment $ 750,000 $ 300,000 Less: Accumulated depreciation (200,000) 550,000 Equipment-net $ 250,000 Consolidated amounts for equipment and accumulated depreciation. at December 31, 2005 were respectively ՄԴ $ 50,000)
Chapter14: Property Transactions: Capital Gains And Losses, § 1231, And Recapture Provisions
Section: Chapter Questions
Problem 32CE
Related questions
Question
![Falcon Corporation sold equipment to its 80%-owned subsidiary,
Rodent Corp., on January 1, 2005. Falcon sold the equipment
for $110,000 when its book value was $85,000 and it had a 5-
year remaining useful life with no expected salvage value.
Separate balance sheets for Falcon and Rodent included the
following equipment and accumulated depreciation amounts on
December 31, 2005:
Falcon
Rodent
Equipment
$
750,000 $
300,000
Less: Accumulated depreciation
200,000)
50,000)
Equipment-net
$
550,000 $
250,000
Consolidated amounts for equipment and accumulated depreciation
at December 31, 2005 were respectively
(](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F7d01f51a-def6-4455-b87b-5d2bdf083db8%2F790b6466-dc8f-4585-a283-0e3efe660e98%2Fx5cln6_processed.png&w=3840&q=75)
Transcribed Image Text:Falcon Corporation sold equipment to its 80%-owned subsidiary,
Rodent Corp., on January 1, 2005. Falcon sold the equipment
for $110,000 when its book value was $85,000 and it had a 5-
year remaining useful life with no expected salvage value.
Separate balance sheets for Falcon and Rodent included the
following equipment and accumulated depreciation amounts on
December 31, 2005:
Falcon
Rodent
Equipment
$
750,000 $
300,000
Less: Accumulated depreciation
200,000)
50,000)
Equipment-net
$
550,000 $
250,000
Consolidated amounts for equipment and accumulated depreciation
at December 31, 2005 were respectively
(
Expert Solution
![](/static/compass_v2/shared-icons/check-mark.png)
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
Step by step
Solved in 2 steps
![Blurred answer](/static/compass_v2/solution-images/blurred-answer.jpg)
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Recommended textbooks for you
![Intermediate Accounting: Reporting And Analysis](https://www.bartleby.com/isbn_cover_images/9781337788281/9781337788281_smallCoverImage.jpg)
Intermediate Accounting: Reporting And Analysis
Accounting
ISBN:
9781337788281
Author:
James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:
Cengage Learning
Principles of Accounting Volume 1
Accounting
ISBN:
9781947172685
Author:
OpenStax
Publisher:
OpenStax College
![Intermediate Accounting: Reporting And Analysis](https://www.bartleby.com/isbn_cover_images/9781337788281/9781337788281_smallCoverImage.jpg)
Intermediate Accounting: Reporting And Analysis
Accounting
ISBN:
9781337788281
Author:
James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:
Cengage Learning
Principles of Accounting Volume 1
Accounting
ISBN:
9781947172685
Author:
OpenStax
Publisher:
OpenStax College
![Cornerstones of Financial Accounting](https://www.bartleby.com/isbn_cover_images/9781337690881/9781337690881_smallCoverImage.gif)
Cornerstones of Financial Accounting
Accounting
ISBN:
9781337690881
Author:
Jay Rich, Jeff Jones
Publisher:
Cengage Learning