A Parent Company Acquires a Subsidiary on January 1, 2018

Multiple Choice

A parent company acquires a subsidiary on January 1, 2018. The subsidiary's equipment (five-year remaining life, straight-line) is undervalued by $30 million at the date of acquisition. On the consolidation working paper prepared at December 31, 2021 (four years later) , by how much does eliminating entry (R) increase the equipment account?

A) $18 million
B) $30 million
C) $6 million
D) $12 million