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Unformatted text preview: Steele sold land that originally cost $1 million to Pierson at a $1.5 million transfer price. 1. What are consolidated journal entries at the end of 2011 and 2012 assuming Pierson does not sell the land? 2. What are the consolidated journal entries when Pierson sells the land for $2 million? Transfer of Depreciable Assets Pierson Company owns 100% of the voting stock of Steele Company and on September 5, 2011, Steele sold equipment with a book value of $1 million to Pierson for $1.5 million. Steele purchased the equipment several years ago for $2 million. Pierson adopt a straight-line depreciation method with no salvage value. Pierson records depreciation expense of $150,000 ($1.5 million/ 10 years) at the end of 2011. 1. What are the consolidated journal entries for 2011? 2. What are the consolidated journal entries for 2012?...
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- Fall '11