Prepare the accounting entries for an investment in a piece of equipment to its subsidiary, which has an original book value of $60,000, accumulated depreciation of $18,000, and a fair value of $45,000.
When the investment is made, debit: Fixed Assets Liquidation 42000
Debit: Accumulated Depreciation 18000
Credit: Fixed Assets 60000
At the same time: debit: Long-term Equity Investment - XX Company 45000
Credit: Fixed Assets Liquidation 42000<
Credit: Capital surplus 3000