Belzer Co Owns 70% of Sabo Ltd

question 40

Multiple Choice

Belzer Co. owns 70% of Sabo Ltd. At the beginning of 20X7, Sabo sold a piece of equipment to Belzer for a gain of $35,000. At that time, the equipment had an estimated useful life of seven years.
-Ten years later, Belzer is still using the equipment. In preparing its consolidated financial statements, Belzer should credit the equipment account by $35,000. What account(s) should be debited in this journal entry?

• A)Opening consolidated retained earnings by $35,000
• B)Opening consolidated retained earnings by $24,500 and NCI by $10,500
• C)Depreciation expense by $35,000
• D)Accumulated depreciation by $35,000

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Definitions:

Leisure

Time spent away from work and essential domestic activities, often used for rest, recreation, or cultural pursuits.

Inferior Good

A type of good for which demand decreases when consumer income rises, in contrast to normal goods, where demand increases with rising income.

Consumer Income

The total amount of income earned by consumers in an economy, including wages, salaries, benefits, and other income sources, influencing their buying power.

Demand Curve

A graph that shows the relationship between the price of a good and the quantity demanded by consumers at various prices.