On 1/1/X1 Peck Sells a Machine with a $20,000 Book

question 21

Multiple Choice

On 1/1/X1 Peck sells a machine with a $20,000 book value to its subsidiary Shea for $30,000. Shea intends to use the machine for 4 years. On 12/31/X2 Shea sells the machine to an outside party for $14,000. What amount of gain or (loss) for the sale of assets is reported on the consolidated financial statements?

• A) loss of $6,000
• B) loss of $1,000
• C) gain of $4,000
• D) gain of $14,000

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Definitions:

Sleepiness

A state of feeling drowsy or tired, often leading to a need or desire to sleep.

Hypocretin

A neurotransmitter involved in the regulation of arousal, wakefulness, and appetite.

Narcolepsy

Narcolepsy is a long-term neurological disorder affecting the brain's ability to control sleep-wake cycles, leading to excessive daytime sleepiness and sudden sleep attacks.

Neurotransmitter

Chemical messengers in the brain and nervous system that transmit signals across synapses from one neuron to another.