On January 1, 20X0, Peace, Inc., acquired 70 percent of Silver's outstanding voting stock. No excess fair-value amortization resulted from the acquisition.
On January 1, 20X0, Peace sold equipment to Silver for $20,000. This asset originally cost $32,000 but had a January 1, 20X0, book value of $16,000. At the time of transfer, the equipment's remaining life was estimated to be four years.
On December 31, 20X1, Peace and Silver had equipment (net) of $200,000 and $120,000, separately. The balance of Equipment (net) that would appear on consolidated financial statements for 20X1 would be:
$319,000.
$320,000.
$316,000.
$318,000.