A 50:50 Joint Operation Was Commenced Between Two Participants

A 50:50 joint operation was commenced between two participants. Mary Company contributed cash of $90 000, and Strickland Company contributed a Building with a fair value of $90 000 and a carrying amount of $75 000. Using the line-by-line method of accounting, Strickland Company would record:

A) DR Building in JO $75 000 CR Building $75 000
B) DR Building in JO $945000 CR Building $37 500
CR Gain on sale of building $7 500
C) DR Investment in joint operation $45 000 CR Building $37 500
CR Gain on sale of building $7 500
D) DR Cash in JO $45 000 DR Building in JO $45 000
CR Building $75 000
CR Gain on sale of building $15 000

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