Nicolo manufacturing produced 10,000 Kitchen clocks in 2021 for P50 each and sold them to San Mig Corp at P150 each. San Mig resoled 8,000 units at P220 each in 2021 and held the remaining units in inventory on December 31, 2021. San Mig owns 70% of the stocks of Nicolo Manufacturing. How much gross profit must be included in the consolidated income statement for 2021?

Nicolo manufacturing produced 10,000 Kitchen clocks in 2021 for P50 each and sold them to San Mig Corp at P150 each. San Mig resoled 8,000 units at P220 each in 2021 and held the remaining units in inventory on December 31, 2021. San Mig owns 70% of the stocks of Nicolo Manufacturing. How much gross profit must be included in the consolidated income statement for 2021?

Cornerstones of Financial Accounting

4th Edition

ISBN:9781337690881

Author:Jay Rich, Jeff Jones

Publisher:Jay Rich, Jeff Jones

ChapterA2: Investments

Section: Chapter Questions

Problem 11MCQ

See similar textbooks

Similar questions

Padlock Corp. owns 90 percent of Safeco, Inc. During the year, Padlock sold 3,000 locking mechanisms to Safeco for $900,000. By the end of the year, Safeco had sold all but 500 of the locking mechanisms to outside parties. Padlock marks up the cost of its locking mechanisms by 60 percent in computing its sales price to affiliated and nonaffiliated customers. How much intra-entity profit remains in Safeco’s inventory at year-end?
ABC Company declared on December 1, 2021 its 10 brand new fleet of cars costing P500,000 each as property dividends to be distributed on February 1, 2022 to its ten shareholders. The following fair value less cost to distribute of the cars was determined to be: December 1, 2021 ....................4,800,000 December 31, 2021 ....................4,500,000 February 1, 2022 ....................4,000,000 What is the net decrease of retained earnings in 2021? What is the carrying amount of the asset held for distribution to be presented in the balance sheet on December 31, 2021? What is the loss on distribution of property dividend to be recognized on February 1, 2022?
On January 1, 2021, Company Ltd. decided to sell one of its processing plants located in New York. The plant, considered a component of the company, was sold on June 1, 2021. The plant assets with a carrying value of $650,000 were sold for $500,000. Operating income at the plant from January 1 to May 31, 2021, was $50,000. Ignoring taxes, what is the total amount that should be reported on Company's income statement for the year ended December 31, 2021, under "discontinued operations"?
Nautilus Co. acquired 100% of XYZ Corp. on January 2, 2020. During 2020, Nautilus sold goods to XYZ Corp for $700,000 that cost Nautilus $500,000. XYZ Corp still owned 40% of the goods at the end of the year. Cost of goods sold was $1,000,000 for Nautilus and $990,000 for XYZ Corp. What was consolidated cost of goods sold?
Goddy Company owns 80% of the common stock of Morris, Inc. In the current year, Goddy reports sales of $10,000,000 and cost of goods sold of $7,500,000. For the same period, Morris has sales of $200,000 and cost of goods sold of $160,000. During the year, Goddy sold merchandise to Morris for $60,000 at a price based on the normal markup. At the end of the year, Morris still possesses 30 percent of this inventory. Compute consolidated cost of goods so ld. Select one: a. $7,604,500. b. $7,500,000. c. $7,660,000. d. $7,615,000. e. $7,600,000.
Sanchez Company acquired inventories on June 1, 2021 from its 60% owned subsidiary, Black Corporation. The inventories were sold for P285,000, including the 20% mark up on cost. Out of these inventories, 70% were sold to outsiders during the current year and the rest was sold in 2022. During 2022, Sanchez Company reported net income of P880,000 and Black Corporation reported net income of P560,000. How much of the realized profit is to be allocated to non-controlling interest in 2022?
ABC Company declared on December 1, 2021 its 10 brand new fleet of cars costing P500,000 each as property dividends to be distributed on February 1, 2022 to its ten shareholders. The following fair value less cost to distribute of the cars was determined to be: December 1, 2021....................4,800,000 December 31, 2021....................4,000,000 February 1, 2022....................4,000,000 What is the net decrease of retained earnings in 2021?
On December 31, 2021, the end of the fiscal year, Revolutionary Industries completed the sale of its robotics business for $9 million. The robotics business segment qualifies as a component of the entity according to GAAP. The book value of the assets of the segment was $7 million. The income from operations of the segment during 2021 was $4 million. Pretax income from continuing operations for the year totaled $12 million. The income tax rate is 25%. Prepare the lower portion of the 2021 income statement beginning with income from continuing operations before income taxes. Ignore EPS disclosures.
GG Co. had the following transactions with two subsidiaries, OO and RR during 2020: Sales of P105,000 to OO, Inc., with P31,500 gross profit, OO had P26,250 of this inventory on hand at year end. Purchases of raw materials totaling P420,000 from RR Corp., a wholly owned subsidiary. RR’s gross profit on the sale was P84,000. GG had P98,000 of this inventory remaining on December 31, 2020. Before eliminating entries, GG had combined current assets of P525,000. What amount should GG report in its December 31, 2020 consolidated financial position for current assets?
Tulip Corp. purchased 300,000 shares of common stock in Sherman Co. for $50 per share on January 2, 2021, which represents 25% of Sherman Co.s outstanding shares. During 2021, Sherman Co. paid cash dividends of $300,000 and reported net income of $1,000,000. At the end of 2021, Sherman Co.'s stock price had dropped to $49 per share. What should appear on Tulip Corp.s income statement in 2021 because of this investment? A: ($300,000) B: ($225,000) C: $75,000 D: $250,000
On December 31,2021 the end of the fiscal year, Califonia Mircotech Corporation completed the sale of its semiconductor business for $10 million. The semiconductor business segment qualifies as a component of the entity according to GAAP. The book value of the assests of the segment was $8 million. The loss from operations of the segment during 2021 was $3.6 million. Pretax income from continuing operation for the year totaled $5.8 million. The income tax rate is 25%. Prepare the lower portion of the 2021 income statement. Assume instead that the estimated fair value of the segments assets, less costs to sell, on December 31 was $7 million rather than $10 million. Prepare the lower portion of the 2021 income statement beginning with income from continuing operations before income taxes.
During the month of August 2020, Xylon Inc. commenced manufacturing of a product called Argon. The following transactions took place. August 1, stockholders paid cash for 100 million stocks with par value of $1 per share and market price of $11 per share. August 1, purchased machinery and Equipment for $40 million cash (Depreciation expense is $1million every month) August 1, purchased raw materials ($50 million direct materials, $4 million indirect materials) for $54 million cash and all materials moved into production immediately. August 20 the company records applied overhead at the rate of 80% of direct material costs August 28, paid cash for manufacturing labor services, $112 million ($100 million direct labor and $12 million indirect labor). August 31, actual costs of other overhead items was calculated to be $34 million. August 31, all the goods charged into production were completed and moved to Finished Goods Inventory Account. August 31, 90% of the completed goods were sold…