Question: On January 1 , 2 0 2 0 , Combs Corporation sold a tract of land to its 1 0 0 % owned subsidiary, Tiniton,

On January 1,2020, Combs Corporation sold a tract of land to its 100% owned subsidiary, Tiniton, Inc., for $550,000. The land originally cost Combs $440,000. Tiniton reported net income of $270,000 and $305,000 for 2020 and 2021, respectively. Combs received dividends from Tiniton of $35,000 and $36,000 for 2020 and 2021, respectively.
28. What is the recorded gain or loss on sale of the land on Combss pre-consolidation books in 2020?
a. $-0-
b. $110,000 loss
c. $550,000 gain
d. $110,000 gain
29 On the consolidation worksheet for 2020, what adjustment would be made to the Land account?
a. $110,000 debit
b. $110,000 credit
c. $440,000 credit
d. $550,000 credit

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