Pigeon Corporation purchased land from its 60%-owned subsidiary, Seed Inc., in 2012 at a cost $50,000 greater than Seed's book value. In 2014, Pigeon sold the land to an outside entity for $20,000 more than Pigeon's book value. The 2014 consolidated income statement should report a gain on the sale of land of A. $70,000. B. $12,000. C. $42,000. D. $20,000.
Pigeon Corporation purchased land from its 60%-owned subsidiary, Seed Inc., in 2012 at a cost $50,000 greater than Seed's book value. In 2014, Pigeon sold the land to an outside entity for $20,000 more than Pigeon's book value. The 2014 consolidated income statement should report a gain on the sale of land of A. $70,000. B. $12,000. C. $42,000. D. $20,000.
Chapter10: Cost Recovery On Property: Depreciation, Depletion, And Amortization
Section: Chapter Questions
Problem 21P
Related questions
Question
Pigeon Corporation purchased land from its 60%-owned subsidiary, Seed Inc., in 2012 at a cost $50,000 greater than Seed's book value. In 2014, Pigeon sold the land to an outside entity for $20,000 more than Pigeon's book value. The 2014 consolidated income statement should report a gain on the sale of land of
| A. |
$70,000. |
|
| B. |
$12,000. |
|
| C. |
$42,000. |
|
| D. |
$20,000. |
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 2 steps
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Recommended textbooks for you
Cornerstones of Financial Accounting
Accounting
ISBN:
9781337690881
Author:
Jay Rich, Jeff Jones
Publisher:
Cengage Learning