Use the Following Information to Answer the Question(s) Below

question 49

Multiple Choice

Use the following information to answer the question(s) below.

On December 31, 2014, Pinne Corporation sold equipment with a three-year remaining useful life and a book value of $21,000 to its 70%-owned subsidiary, Sull Company, for a price of $27,000. Pinne bought the equipment four years ago for $49,000. The salvage value is zero. Straight-line depreciation is used by both companies.

-An elimination entry at December 31,2014 for the intercompany sale will include a

• A)credit of $6,000 to Depreciation Expense.
• B)credit of $6,000 to Accumulated Depreciation.
• C)credit of $6,000 to Equipment.
• D)credit of $6,000 to Gain on Sale of Equipment.

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Definitions:

Vital Capacity (VC)

The greatest volume of air that can be expelled from the lungs after taking the deepest possible breath; an important measurement in respiratory health.

Residual Volume (RV)

The volume of air remaining in the lungs after a forceful expiration, ensuring that gas exchange can continue at all times.

Anatomic Dead Space

refers to areas of the respiratory system where gas exchange does not take place, such as the trachea and bronchi.

Inspiratory Reserve Volume (IRV)

The additional air that can be forcefully inhaled after a normal inhalation.