On January 1, 2010, Smeder Company, an 80% Owned Subsidiary

question 91

Multiple Choice

On January 1, 2010, Smeder Company, an 80% owned subsidiary of Collins, Inc., transferred equipment with a 10-year life (six of which remain with no salvage value) to Collins in exchange for $84,000 cash. At the date of transfer, Smeder's records carried the equipment at a cost of $120,000 less accumulated depreciation of $48,000. Straight-line depreciation is used. Smeder reported net income of $28,000 and $32,000 for 2010 and 2011, respectively. All net income effects of the intra-entity transfer are attributed to the seller for consolidation purposes.
-Compute the gain recognized by Smeder Company relating to the equipment for 2010.

• A) $36,000.
• B) $34,000.
• C) $12,000.
• D) $10,000.
• E) $0.

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Definitions:

Southern Theory

An approach in sociology that highlights the importance of perspectives, theories, and insights from the Global South in understanding global social dynamics.

Western World

Refers to societies and nations, primarily in Europe and the Americas, characterized by democratic forms of government, capitalist economies, and Christian cultural influences.

White Social Capital

The benefits and resources accrued by individuals through their membership in predominantly white social networks or communities.

Racial Field

A sociological term referring to the social and power dynamics structured by race, affecting individuals' positions and interactions in society.