Multiple Choice
Patriot Corporation owns 100% of Simon Company's common stock. On January 1, 2017, Patriot sold equipment with a book value of $350,000 to Simon for $500,000. Simon is depreciating the equipment over a ten-year life by the straight-line method. The net adjustments to compute 2017 and 2018 consolidated income would be an increase (decrease) of:
A) 2017, ($150,000) ; 2018, $0
B) 2017, ($150,000) ; 2018, $15,000
C) 2017, ($135,000) ; 2018, $0
D) 2017, ($135,000) ; 2018, $15,000
Correct Answer:
Verified
Correct Answer:
Verified
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