2004 at a time when Cliff's book val qual to one another. On January 1, with a $45,000 book value to Pe grine is depreciating the truck ove light-line method. Separate incomes f 2005 were as follows:
2004 at a time when Cliff's book val qual to one another. On January 1, with a $45,000 book value to Pe grine is depreciating the truck ove light-line method. Separate incomes f 2005 were as follows:
Chapter10: Cost Recovery On Property: Depreciation, Depletion, And Amortization
Section: Chapter Questions
Problem 44P
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Question
Compute for the Investment income from Cliff.
Transcribed Image Text:Peregrine Corporation acquired a 90%
interest in cliff
Corporation in 2004 at a time when cliff's book values and fair
values were equal to one another. On January 1, 2005, cliff
sold a truck with a $45,000 book value to Peregrine for
$90,000. Peregrine is depreciating the truck over 10 years
using the straight-line method. Separate incomes for Peregrine
and cliff for 2005 were as follows:
cliff
Peregrine
1,800,000 $ 1,050,000
Sales
$
45,000
Gain on sale of truck
Cost of Goods Sold
(750,000)
Depreciation expense
Other expenses
Separate incomes
(450,000)
180,000)
420,000 $
( 285,000)
( 135,000)
450,000)
225,000
-55
$
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