Fearless, Inc. owns 100% of the outstanding stock of Hyena, Inc.

On January 1, 2021, Fearless sells a machine with a book value of $400,000 to Hyena for $430,000. Fearless had originally acquired the machine from an outside party. The subsidiary places the machine in service and depreciates the asset using the straight-line method over a five year life with no salvage value.

On January 1, 2021, what amount of gain should Fearless, Inc. record in its separate books on the sale of the machine?


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