Stern Manufacturing purchased an ultrasound drilling machine with a remaining 10-year economic life from a...
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Stern Manufacturing purchased an ultrasound drilling machine with a remaining 10-year economic life from a 70 percent-owned subsidiary for 5380,000 on January 1, 20X8. Both companies use straight-line depreciation. The subsidiary recorded the following entry when it sold the machine to Stern: Debit Credit 360,000 150,000 General Journal Cash Accumulated Depreciation Equipment Gain on Sale of Equipment 450,000 60,000 Required: Prepare the worksheet consolidation entry or entries needed to remove the effects of the intercompany sale of equipment when consolidated financial statements are prepared as of (a) December 31, 20x6, and (b) December 31, 20X7. (If no entry is required for a transactionlevent, select "No journal entry required in the first account field.) view transaction list Consolidation Worksheet Entries Record the entry to eliminate the gain on the equipment and to correct the asset's basis Note: Enter debits before credits. Date Accounts Debit Credit Dec. 31, 20x6 Record entry Clear entry entries
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