Carlos Bakery owns 60 percent of the stocks of Zeus Products acquired several years ago at book values. On January 1, 2021, inventory reported by Carlos included 20,000 bags of flour purchased from Zeus at P90 per bag. By December 31, 2021, all of these had been baked into products and sold to customers by Carlos Bakery. There were no other transactions between them during 2021. Both Carlos and Zeus price their sales at cost plus 50% mark up for profit. Carlos reported net income from its own operations of P3,000,000 and Zeus reported net income of P2,500,000 in 2021. Compute the consolidated net income for 2021

Carlos Bakery owns 60 percent of the stocks of Zeus Products acquired several years ago at book values. On January 1, 2021, inventory reported by Carlos included 20,000 bags of flour purchased from Zeus at P90 per bag. By December 31, 2021, all of these had been baked into products and sold to customers by Carlos Bakery. There were no other transactions between them during 2021. Both Carlos and Zeus price their sales at cost plus 50% mark up for profit. Carlos reported net income from its own operations of P3,000,000 and Zeus reported net income of P2,500,000 in 2021. Compute the consolidated net income for 2021

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter16: Retained Earnings And Earnings Per Share

Section: Chapter Questions

Problem 23E

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