What net debit or credit will be made in 2009


On January 1, 2009, Smeder Company, an 80% owned subsidiary of Collins, Inc. transferred equipment with a 10-year life (six of which remain with no salvage value) to Collins in exchange for $84,000 cash. At the date of transfer, Smeder's records carried the equipment at a cost of $120,000 less accumulated depreciation of $48,000. Straight-line depreciation is used. Smeder reported net income of $28,000 and 432,000 for 2009 and 2010, respectively. For consolidation purposes, what net debit or credit will be made in 2009 relating to the equipment transfer?

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Accounting Basics: What net debit or credit will be made in 2009
Reference No:- TGS087353

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