Stark Company, a 90% Owned Subsidiary of Parker, Inc

question 19

Multiple Choice

Stark Company, a 90% owned subsidiary of Parker, Inc., sold land to Parker on May 1, 2010, for $80,000. The land originally cost Stark $85,000. Stark reported net income of $200,000, $180,000, and $220,000 for 2010, 2011, and 2012, respectively. Parker sold the land purchased from Stark in 2010 for $92,000 in 2012. Compute Parker's reported gain or loss relating to the land for 2012.

• A) $12,000 gain.
• B) $5,000 loss.
• C) $12,000 loss.
• D) $7,000 gain.
• E) $7,000 loss.

---

Definitions:

Resting Potential

The stable, negative charge of an inactive neuron.

Polarization

In social psychology, the phenomenon where an individual or group's opinions become more extreme from discussing within a like-minded group. In physics, the orientation of electromagnetic waves or the alignment of charges within a material.

Efferent Nerves

Also called motor nerves; nerves that carry information out of the brain and spinal cord to other areas of the body.

Afferent Nerves

Nerves that carry sensory signals from organs and tissues to the brain or spinal cord.