Consolidated income statement basics


On January 1, 1997, Prim, Inc. acquired all the outstanding common shares of Scarp, Inc. for cash equal to the book value of the stock. The carrying amounts of Scarp's assets and liabilities approximated their fair values, except that the carrying amount of its building was more than fair value. In preparing Prims's 1997 consolidated income statement, which of the following adjustments would be made?

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Accounting Basics: Consolidated income statement basics
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