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Problem:

Clemente Co. owned all of the voting common stock of Snider Co. On January 2, 2010, Clemente sold equipment to Snider for $125,000. The equipment had cost Clemente $140,000. At the time of the sale, the balance in accumulated depreciation was $40,000. The equipment had a remaining useful life of five years and a $0 salvage value. Straight-line depreciation is used by both Clemente and Snider.

At what amount should the equipment (net of depreciation) be included in the consolidated balance sheet dated December 31, 2011?

$100,000.
$60,000.
$110,000.
$105,000.
$90,000.

Note: Please show how you came up with the solution.

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Category:- Basic Finance
Reference No.:- M91162943

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