Karli Company, a 90% owned subsidiary of Moe, Inc., sold land to Moe on May...
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Accounting
Karli Company, a 90% owned subsidiary of Moe, Inc., sold land to Moe on May 1, 2020, for $80,000. The land originally cost Karli $85,000. Karli reported net income of $200,000, $180,000, and $220,000 for 2020, 2021, and 2022, respectively. Moe sold the land purchased from Karli for $92,000 in 2022. Both companies use the equity method of accounting.
Compute the gain or loss relating to the land that will be reported in consolidated net income for 2022.
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