Examlex

Solved

Wilson Owned Equipment with an Estimated Life of 10 Years

question 61

Multiple Choice

Wilson owned equipment with an estimated life of 10 years when it was acquired for an original cost of $80,000. The equipment had a book value of $50,000 at January 1, 2010. On January 1, 2010, Wilson realized that the useful life of the equipment was longer than originally anticipated, at ten remaining years. On April 1, 2010 Simon Company, a 90% owned subsidiary of Wilson Company, bought the equipment from Wilson for $68,250 and for depreciation purposes used the estimated remaining life as of that date. The following data are available pertaining to Simon's income and dividends: Wilson owned equipment with an estimated life of 10 years when it was acquired for an original cost of $80,000. The equipment had a book value of $50,000 at January 1, 2010. On January 1, 2010, Wilson realized that the useful life of the equipment was longer than originally anticipated, at ten remaining years. On April 1, 2010 Simon Company, a 90% owned subsidiary of Wilson Company, bought the equipment from Wilson for $68,250 and for depreciation purposes used the estimated remaining life as of that date. The following data are available pertaining to Simon's income and dividends:   Compute the amortization of gain through a depreciation adjustment for 2012 for consolidation purposes. A)  $1,925. B)  $1,825. C)  $2,000. D)  $1,500. E)  $7,000. Compute the amortization of gain through a depreciation adjustment for 2012 for consolidation purposes.


Definitions:

Prefrontal Cortex

A region at the front of the frontal lobe of the brain, responsible for complex cognitive behavior, decision making, and moderating social behavior.

Premotor Cortex

A region of the frontal lobe involved in planning and coordinating movements.

Motor Cortex

A region of the brain in the frontal lobe involved in planning, controlling, and executing voluntary movements.

Orbitofrontal Lesions

Damage to the orbitofrontal cortex, which can alter personality and inhibit social and emotional behavior, leading to deficits in decision-making and impulse control.

Related Questions