A Parent Entity Group Sold a Depreciable Non-Current Asset to a Subsidiary

question 36

Multiple Choice

A parent entity group sold a depreciable non-current asset to a subsidiary entity for $5 300. The asset originally cost $7 000 when acquired from an external party and at the date of the intragroup sale the accumulated depreciation was $2 200. The amount of the unrealised gain on the intragroup sale to be eliminated is:

• A) $500.
• B) $2 200.
• C) $4 800.
• D) $5 300.

---

Definitions:

Employee Evaluating

The process of assessing and reviewing an employee's work performance by comparing it with preset standards, and providing feedback.

Functional Lines

The division of a business into departments or teams based on functions such as marketing, finance, or operations.

Functional Expertise

Specialized knowledge and skills in a particular area or department within an organization that contribute to its efficiency and success.

Economies of Scale

Cost advantages that enterprises obtain due to their scale of operation, typically resulting from factors like mass production and bulk purchasing.