Dalton Corp

question 55

Multiple Choice

Dalton Corp.owned 70% of the outstanding common stock of Shrugs Inc.On January 1, 2016, Dalton acquired a building with a ten-year life for $420,000.No salvage value was anticipated and the building was to be depreciated on the straight-line basis.On January 1, 2018, Dalton sold this building to Shrugs for $392,000.At that time, the building had a remaining life of eight years but still no expected salvage value.For consolidation purposes, what is the Excess Depreciation (ED entry) for this building for 2018?

• A) Accumulated Depreciation 7,000 Depreciation expense 7,000
• B) Accumulated Depreciation 4,900 Depreciation Expense 4,900
• C) Depreciation Expense 7,000 Accumulated Depreciation 7,000
• D) Depreciation Expense 4,900 Accumulated Depreciation 4,900
• E) Accumulated Depreciation 42,000 Depreciation Expense 42,000

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Definitions:

Permanent Magnet

A material that maintains a continuous magnetic field without the need for external power.

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A type of magnet in which the magnetic field is produced by an electric current.

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Devices that use optical fibers to detect changes in light or other optical properties for sensing applications.

Electrical Interference

Noise or disturbance in electrical circuits caused by external sources, which can compromise the performance of electronic equipment.