ABC Ltd. Sells a machine to its 80% owned subsidiary XYZ Co, on 1/1/2015. The original cost of the machine was $50,000 and at the date of transfer accumulated depreciation was $20,000. The transfer price was $40,000 and the machine had a remaining life of 5 years. ABC originally paid $400,000 for its 80% ownership in XYZ Co., on 1/1/2014 and any excess fair value was attributed to goodwill, which was not impaired. XYZ posted net income of $30,000 and dividends of $10,000 in 2014 and net income of $60,000 and dividends of $30,000 in 2015. Record the consolidating entries related to the machine transfer for 2015 and 2016. 

Calculate the Investment in XYZ account balance at 12/31/2016 and the NC interest in subsidiary income for 2016.

Answer rating: 100% (QA)

To record the consolidating entries related to the machine transfer for 2015 and 2016 we need to con... View the full answer