Clemente Co. owned all of the voting common stock of Snider Co. On January 2, 20

Question

Clemente Co. owned all of the voting common stock of Snider Co. On January 2, 2010, Clemente sold equipment to Snider for $125,000. The equipment had cost Clemente $140,000. At the time of the sale, the balance in accumulated depreciation was $40,000. The equipment had a remaining useful life of five years and a $0 salvage value. Straight-line depreciation is used by both Clemente and Snider.

At what amount should the equipment (net of depreciation) be included in the consolidated balance sheet dated December 31, 2011?

Explanation / Answer

140000-40000-40000=60000

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