An Intra-Entity Sale Took Place Whereby the Transfer Price Exceeded

question 35

Multiple Choice

An intra-entity sale took place whereby the transfer price exceeded the book value of a depreciable asset. Which statement is true for the year following the sale?

• A) A worksheet entry is made with a debit to gain for a downstream transfer.
• B) A worksheet entry is made with a debit to gain for an upstream transfer.
• C) A worksheet entry is made with a debit to investment in subsidiary for a downstream transfer when the parent uses the equity method.
• D) A worksheet entry is made with a debit to retained earnings for a downstream transfer, regardless of the method used account for the investment.
• E) No worksheet entry is necessary.

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Definitions:

Neuron

A neuron, which serves as the foundational unit of the nervous system, is essential for the reception, processing, and communication of information via electrical and chemical signals.

Impulse

A sudden, involuntary urge to do something.

Neural Transmission

The process by which neurons communicate with each other through electrical and chemical signals.

Action Potentials

Electrical impulses that are the means of communication and signal transmission within the nervous system, particularly among neurons.