On December 31, 2017, Zack Corporation sold equipment with a three-year remaining useful life and a book value of $21,000 to its 70%-owned subsidiary, Necole Company, for a price of $27,000. Zack bought the equipment four years ago for $49,000. The salvage value is zero. Straight-line depreciation is used by both companies.

After eliminating/adjusting entries are prepared, what was the intercompany sale impact on the consolidated financial statements for the year ended December 31, 2017?

Answer rating: 100% (QA)

Book value of equipment 21000 sale ... View the full answer