On January 1, 2018, Payton Co

Multiple Choice

On January 1, 2018, Payton Co.sold equipment to its subsidiary, Starker Corp., for $115,000.The equipment had cost $125,000, and the balance in accumulated depreciation was $45,000.The equipment had an estimated remaining useful life of eight years and $0 salvage value.Both companies use straight-line depreciation.On their separate 2018 income statements, Payton and Starker reported depreciation expense of $84,000 and $60,000, respectively.The amount of depreciation expense on the consolidated income statement for 2018 would have been:

A) $144,000.
B) $148,375.
C) $109,000.
D) $134,000.
E) $139,625.