Victory Co. owned 90% of the voting common stock of Walker Co. On January 3, 2022, Victory sold equipment to Walker for $160,000. The equipment cost Victory $180,000. At the time of the transfer, the balance in accumulated depreciation was $36,000. The equipment had a remaining useful life of eight years and a zero salvage value. Both entities use the straight-line method of depreciation. At what amount should the equipment (net of depreciation) be included in the consolidated balance sheet dated December 31, 2022?
Victory Co. owned 90% of the voting common stock of Walker Co. On January 3, 2022, Victory sold equipment to Walker for $160,000. The equipment cost Victory $180,000. At the time of the transfer, the balance in accumulated depreciation was $36,000. The equipment had a remaining useful life of eight years and a zero salvage value. Both entities use the straight-line method of depreciation. At what amount should the equipment (net of depreciation) be included in the consolidated balance sheet dated December 31, 2022?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Victory Co. owned 90% of the voting common stock of Walker Co. On January 3, 2022, Victory sold equipment to Walker for $160,000. The equipment cost Victory $180,000. At the time of the transfer, the balance in accumulated depreciation was $36,000. The equipment had a remaining useful life of eight years and a zero salvage value. Both entities use the straight-line method of depreciation.
At what amount should the equipment (net of depreciation) be included in the consolidated balance sheet dated December 31, 2022?
$140.000
$132.800
$127.800
$126.000
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