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At the start of the current year, SBC Corp. purchased 25% of Sky Tech Inc. for...

At the start of the current year, SBC Corp. purchased 25% of Sky Tech Inc. for $47 million. At the time of purchase, the carrying value of Sky Tech's net assets was $80 million. The fair value of Sky Tech's depreciable assets was $12 million in excess of their book value. For this year, Sky Tech reported a net income of $80 million and declared and paid $12 million in dividends.

The total amount of additional depreciation to be recognized by SBC over the remaining life of the assets is:

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The total amount of additional depreciation to be recognized by SBC over the remaining life of the assets is:
(in millions)
FMV in excess of book value $                        12
Share of ownership 25%
Additional depreciation, in total ( 12*25% ) $                          3
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