Pam Corporation owns an 80 percent interest in Sun Corporation acquired several years ago. Sun regularly sells mer- chandise to Pam at 125 percent of Sun's cost. Gross profit data of Pam and Sun for 2017 are as follows: Pam Sun Sales $1,000 $800 Cost of goods sold Gross profit 640 $160 800 200 During 2017, Pam purchased inventory items from Sun at a transfer price of $400. Pam's December 31, 2016 and 2017, inventories included goods acquired from Sun of $100 and $125, respectively. Assume Pam sells the inventory purchased from Sun in the following year. 1. Consolidated sales of Pam Corporation and Subsidiary for 2017 were: a $1,800 b $1,425 C $1,400 d $1,240 2. The unrealized profits in the year-end 2016 and 2017 inventories were: a $100 and $125, respectively b $80 and $100, respectively c $20 and $25, respectively d $16 and $20, respectively 3. Consolidated cost of goods sold of Pam Corporation and Subsidiary for 2017 was: a $1,024 b $1,045 C $1,052.8 d $1,056

Pam Corporation owns an 80 percent interest in Sun Corporation acquired several years ago. Sun regularly sells mer- chandise to Pam at 125 percent of Sun's cost. Gross profit data of Pam and Sun for 2017 are as follows: Pam Sun Sales $1,000 $800 Cost of goods sold Gross profit 640 $160 800 200 During 2017, Pam purchased inventory items from Sun at a transfer price of $400. Pam's December 31, 2016 and 2017, inventories included goods acquired from Sun of $100 and $125, respectively. Assume Pam sells the inventory purchased from Sun in the following year. 1. Consolidated sales of Pam Corporation and Subsidiary for 2017 were: a $1,800 b $1,425 C $1,400 d $1,240 2. The unrealized profits in the year-end 2016 and 2017 inventories were: a $100 and $125, respectively b $80 and $100, respectively c $20 and $25, respectively d $16 and $20, respectively 3. Consolidated cost of goods sold of Pam Corporation and Subsidiary for 2017 was: a $1,024 b $1,045 C $1,052.8 d $1,056

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

Chapter12: Intangibles

Section: Chapter Questions

Problem 12E

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Tala Co. owns an 80% interest in Kilometro Inc., acquired several years ago. Kilometro regularly sells merchandise to its parent at 125% of its cost. Gross profit data of Tala and Kilometro for the year 2018 are:SalesTala- 2,500,000Kilometro- 1,800,000Cost of SalesTala- 1,800,000Kilometro- 1,240,000During 2018, Tala purchased inventory items from Kilometro at a transfer price of 400,000. Tala December 31, 2017 and 2018 inventories were 500,000 and 600,000 respectively, which included goods acquired from Kilometro of 125,000 and 100,000 respectively. The inventory of Kilometro at the beginning and end of 2018 were 350,000 and 400,000 respectively. As of December 31, 2018, 60% of the year’s shipment is not yet paid by Tala.what amount of inventory is reported in the consolidated balance sheet at December 31, 2018?
Tala Co. owns an 80% interest in Kilometro Inc., acquired several years ago. Kilometro regularly sells merchandise to its parent at 125% of its cost. Gross profit data of Tala and Kilometro for the year 2018 are: Sales Tala- 2,500,000 Kilometro- 1,800,000 Cost of Sales Tala 1,800,000 Kilometro- 1,240,000 During 2018, Tala purchased inventory items from Kilometro at a transfer price of 400,000. Tala December 31, 2017 and 2018 inventories were 500,000 and 600,000 respectively, which included goods acquired from Kilometro of 125,000 and 100,000 respectively. The inventory of Kilometro at the beginning and end of 2018 were 350,000 and 400,000 respectively. As of December 31, 2018, 60% of the year's shipment is not yet paid by Tala. 1. What is the consolidated cost of sales? 2. What amount of Inventory is reported in the consolidated balance sheet at December 31, 2018?
On January 1, 2014, Plastam Industries acquired an 80% interest in Sparta Company to assure a steady supply of Sparta's inventory that Plastam uses in its own manufacturing businesses. Sparta sold 100% of its output to Plastam during 2014 and 2015 at a markup of 125% of Sparta's cost. Plastam had $12,000 of these items remaining in its inventory at December 31, 2015. If Plastam neglected to eliminate unrealized profits from all intercompany sales from Sparta, the inventory on the consolidated balance sheet at A. overstated by $2,400. B. understated by $1,920. C. overstated by $1,920. D. understated by $2,400.
Parkette, Inc., acquired a 60 percent interest in Skybox Company several years ago. During 2020, Skybox sold inventory costing $90,200 to Parkette for $110,000. A total of 12 percent of this inventory was not sold to outsiders until 2021. During 2021, Skybox sold inventory costing $294,800 to Parkette for $335,000. A total of 29 percent of this inventory was not sold to outsiders until 2022. In 2021, Parkette reported cost of goods sold of $527,500 while Skybox reported $422,500. What is the consolidated cost of goods sold in 2021? Multiple Choice a $605,718. b $959,282. c $635,400. d $624,282.
Parkette, Inc., acquired a 60 percent interest in Skybox Company several years ago. During 2017, Skybox sold inventory costing $160,000 to Parkette for $200,000. A total of 18 percent of this inventory was not sold to outsiders until 2018. During 2018, Skybox sold inventory costing $297,500 to Parkette for $350,000. A total of 30 percent of this inventory was not sold to outsiders until 2019. In 2018, Parkette reported cost of goods sold of $607,500 while Skybox reported $450,000. What is the consolidated cost of goods sold in 2018?a. $698,950b. $720,000c. $1,066,050d. $716,050
RAM, Inc., acquired a 60 percent interest in LMU Company several years ago. During 2017, LMU sold inventory costing $160,000 to RAM for $200,000. A total of 18 percent of this inventory was not sold to outsiders until 2018. During 2018, LMU sold inventory costing $297,500 to RAM for $350,000. A total of 30 percent of this inventory was not sold to outsiders until 2019. In 2018, RAM reported cost of goods sold of $607,500 while LMU reported $450,000. What consolidation entries will be made for these transactions in 2018 consolidation?
Following are several figures reported for Allister and Barone as of December 31, 2018: Allister Barone Inventory $ 410,000 $ 210,000 Sales 820,000 620,000 Investment income not given Cost of goods sold 410,000 310,000 Operating expenses 185,000 255,000 Allister acquired 80 percent of Barone in January 2017. In allocating the newly acquired subsidiary's fair value at the acquisition date, Allister noted that Barone had developed a customer list worth $60,000 that was unrecorded on its accounting records and had a 4-year remaining life. Any remaining excess fair value over Barone's book value was attributed to goodwill. During 2018, Barone sells inventory costing $121,000 to Allister for $162,000. Of this amount, 10 percent remains unsold in Allister's warehouse at year-end. Determine balances for the following items that would appear on Allister's consolidated financial statements for 2018:
On January 1, 2018, Spark Corp. acquired a 40% interest in Cranston Inc. for $250,000. On that date, Cranston’s balance sheet disclosed net assets of $430,000. During 2018, Cranston reported net income of $100,000 and paid cash dividends of $30,000. Spark sold inventory costing $40,000 to Cranston during 2018 for $50,000. Cranston used all of this merchandise in its operations during 2018. Any excess cost over fair value is attributable to an unamortized trademark with a 20-year remaining life. Prepare all of spark's journal entries for 2018 to apply the equity method to this investment. This is what I have so Far: To record initial investment: Dr Equity Investment 250,000 Cr Cash 250,000 To record investee income: Dr Equity Investment 40, 000 Cr Equty Income To record Dividends Dr Cash 12, 000 Cr Equity Investment 12,000 How do I show the inventory when it is sold?
On January 1, 2015, P Company acquired a 90% interest in S Company. During 2016, S Company sold merchandise to P Company at 25% above cost in the amount (selling price) of $203,700. At the end of the year, P Company had in its inventory one-third of the amount of goods purchased from S Company.On January 1, 2016, P Company sold equipment that had a book value of $83,600 to S Company for $118,100. The equipment had an estimated remaining life of four years.S Company reported net income of $116,100, and P Company reported net income of $293,000 from their independent operations (including sales to affiliates) for the year ended December 31, 2016.Calculate controlling interest in consolidated net income for the year ended December 31, 2016.
following are several figures reported for Allister and Barone as of December 31, 2018: Allister Barone Inventory $ 400,000 $ 200,000 Sales 800,000 600,000 Investment income not given Cost of goods sold 400,000 300,000 Operating expenses 180,000 250,000 Allister acquired 70 percent of Barone in January 2017. In allocating the newly acquired subsidiary's fair value at the acquisition date, Allister noted that Barone had developed a customer list worth $65,000 that was unrecorded on its accounting records and had a 5-year remaining life. Any remaining excess fair value over Barone's book value was attributed to goodwill. During 2018, Barone sells inventory costing $120,000 to Allister for $160,000. Of this amount, 20 percent remains unsold in Allister's warehouse at year-end. Determine balances for the following items that would appear on Allister's consolidated financial statements for 2018: Inventory____$_____________________…
P Inc. owns a 60% interest in S Corp. During 2020 S sold inventory costing $160,000 to P for $200,000. A total of 18 percent of this inventory was not sold to outsiders until 2021. During 2021 S sold inventory costing $297,500 to P for $350,000. A total of 30 percent of this inventory was not sold to outsiders until 2022. In 2021 P reported the cost of goods sold of $607,500 while S reported $450,000. What is the consolidated cost of goods sold in 2021?
The following are several figures reported for Allister and Barone as of December 31, 2021: Allister Barone Inventory $ 580,000 $ 380,000 Sales 1,160,000 960,000 Investment income not given Cost of goods sold 580,000 480,000 Operating expenses 270,000 340,000 Allister acquired 90 percent of Barone in January 2020. In allocating the newly acquired subsidiary's fair value at the acquisition date, Allister noted that Barone had developed a customer list worth $72,000 that was unrecorded on its accounting records and had a six-year remaining life. Any remaining excess fair value over Barone's book value was attributed to goodwill. During 2021, Barone sells inventory costing $138,000 to Allister for $196,000. Of this amount, 20 percent remains unsold in Allister's warehouse at year-end. Determine balances for the following items that would appear on Allister's consolidated financial statements for 2021: