Equity process to account for the investment

Assignment Help Accounting Basics

Reference no: EM13145934

Pepe, Incorporated acquired 60% of Devin company on January 1, 2009. On that date Devin sold equipment to Pepe for $45,000. The equipment had a cost of $120,000 and accumulated depreciation of $66,000 with a remaining life of 9 years. Devin reported net income of $300,0000 and $325,000 for 2009 and 2010, respectively. Pepe uses the equity method to account for its investment in Devin. What is the gain or loss on equipment reported by Devin for 2009?

a. $54,000 gain

b. $21,000 loss

c. $21,000 gain

d. $9,000 loss

e. $9,000 gain

Reference no: EM13145934

Questions Cloud

What does the most recent helsinki declaration include : What does the most recent Helsinki Declaration include that is not included in the Nuremberg Code?

How many grams of magnesium chloride,would be required : How many grams of magnesium chloride, MgCl2, would be required to prepare a 0.2019 m MgCl2 solution by combining this compound with 0.2050 L of water (assume a density of 1.00 g/mL)?

Find average cost of sofa-advertised sofa is of given value : Let X be the cost of the sofa. What is the average cost of a sofa if the advertised sofa is $250 and the more expensive sofa is $ 375?

What is the best course of action for this patient : What is the most likely cause for his hypotension and tachycardia?

Equity process to account for the investment : Pepe uses the equity method to account for its investment in Devin. What is the gain or loss on equipment reported by Devin for 2009?

How many milliliters of 2.5 m nahco3 must be poured : An auto mechanic spills 90. mL of 2.6 M H2SO4 solution from a rebuilt auto battery. How many milliliters of 2.5 M NaHCO3 must be poured on the spill to react completely with the sulfuric acid

What is the most likely diagnosis : For any EKG reading, describe the waves and their respective corresponding electrical and mechanical activities.

Record the sale of receivable : Assume the conditions from part (a) are met. Prepare the Journal entry on August 15,20X0, for Gringo to record the sale of receivable, assuming the recourse obligation has a fair value of $2,000.

What is the mechanism of action for aspirin : A patient is scheduled for elective surgery. The patient is currently taking 325 mg of enteric-coated asprin.

User Account

All Pages