On January 1, 20X1, P sells an equipment with P20,000 book value to its subsidiary S for P30,000. S intends to use the equipment for 4 years. On December 31, 20x2, S sells the equipment to an outside party for P14,000. What amount of gain or (loss) for sale of equipment is reported on the consolidated financial statements? A. Gain 14,000 B. Loss 6,000 C. Loss 1,000 D. Gain 4,000

On January 1, 20X1, P sells an equipment with P20,000 book value to its subsidiary S for P30,000. S intends to use the equipment for 4 years. On December 31, 20x2, S sells the equipment to an outside party for P14,000. What amount of gain or (loss) for sale of equipment is reported on the consolidated financial statements? A. Gain 14,000 B. Loss 6,000 C. Loss 1,000 D. Gain 4,000

Cornerstones of Financial Accounting

4th Edition

ISBN:9781337690881

Author:Jay Rich, Jeff Jones

Publisher:Jay Rich, Jeff Jones

Chapter7: Operating Assets

Section: Chapter Questions

Problem 11MCQ

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