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Business, 25.11.2019 22:31 shadekashakay
Stern manufacturing purchased an ultrasound drilling machine with a remaining 10-year economic life from a 70 percent-owned subsidiary for $360,000 on january 1, 20x6. both companies use straight-line depreciation. the subsidiary recorded the following entry when it sold the machine to stern:
general journal debit credit
cash 360,000
accumulated depreciation 150,000
equipment 450,000
gain on sale of equipment 60,000
required:
prepare the worksheet consolidation entry or entries needed to remove the effects of the intercompany sale of equipment when consolidated financial statements are prepared as of (a) december 31, 20x6, and (b) december 31, 20x7. (if no entry is required for a transaction/event, select "no journal entry required" in the first account field.)
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