Please help me with what i have got wrong. Upstream Intercompany Merchandise TransactionsJimmitz Inc. is a subsidiary of Krocker Gear. Jimmitz sells shoe accessories to Krocker at a 25% markup on cost. Information on these intercompany merchandise transactions is below:Inventory balance on Krocker's books, purchased from Jimmitz, January 1, 2020Inventory balance on Krocker's books, purchased from Jimmitz, December 31, 2020Total sales revenue recorded by Jimmitz on merchandise sales to Krocker in 2020$11,25010,2501,500,000Requireda. Prepare the working paper eliminating entries related to these intercompany transactions at December 31, 2020.DescriptionCreditRetained earnings, beg. - Krocker+✓Debit2,250 ✓0✔Cost of goods sold✓2,250 ✓To eliminate the intercompany profit from Krocker's beg. Inventory.Sales revenue+1,500,000 ✓0✔1,500,000 ✓Cost of goods sold✓To eliminate intercompany sales and purchases.Cost of goods sold+✓2,050 ✓0 ✓Inventories0✔2.050 ✓To eliminate the intercompany profit from Krocker's ending inventory.b. Krocker sold shoes containing Jimmitz's shoe accessories during 2020.What amount did Krocker and Jimmitz record as cost of goods sold for the shoe accessories in 2020?Krocker: $ 1,501,000Jimmitz: $ 281,500XWhat amount should appear in consolidated cost of goods sold for these shoe accessories?$ 1,200,800Show how the eliminating entries in part a adjust Krocker's cost of goods sold balance to the correct consolidated balance.Note: Enter your "Credit" answers in the same order that they were entered in part a.ConsolidatedBalancesKrockerDr (Cr)Cost of goods sold $ 1,501,000JimmitzDr (Cr)AccountCreditDebit300,200 *Dr (Cr)$1,200,800✔0 x1,200,800 x$300,200 x+

Consolidation- Consolidation means combining two or more business organizations or entities into a…

pstream Intercompany Merchandise Transactions mmitz Inc. is a subsidiary of Krocker Gear. Jimmitz sells shoe accessories to Krocker at a 25% markup on cost. Information on these intero $11,250 nventory balance on Krocker's books, purchased from Jimmitz, January 1, 2020 nventory balance on Krocker's books, purchased from Jimmitz, December 31, 2020 Total sales revenue recorded by Jimmitz on merchandise sales to Krocker in 2020 10,250 1,500,000 equired a. Prepare the working paper eliminating entries related to these intercompany transactions at December 31, 2020. Description Debit Credit Retained earnings, beg. - Krocker Cost of goods sold To eliminate the intercompany profit from Krocker's beg. Inventory. Sales revenue ✔ Cost of goods sold • To eliminate intercompany sales and purchases. Cost of goods sold 2,250 1,500,000 ✓ 0✓ 2,050 2.250 0✔ 1,500,000

pstream Intercompany Merchandise Transactions mmitz Inc. is a subsidiary of Krocker Gear. Jimmitz sells shoe accessories to Krocker at a 25% markup on cost. Information on these intero $11,250 nventory balance on Krocker's books, purchased from Jimmitz, January 1, 2020 nventory balance on Krocker's books, purchased from Jimmitz, December 31, 2020 Total sales revenue recorded by Jimmitz on merchandise sales to Krocker in 2020 10,250 1,500,000 equired a. Prepare the working paper eliminating entries related to these intercompany transactions at December 31, 2020. Description Debit Credit Retained earnings, beg. - Krocker Cost of goods sold To eliminate the intercompany profit from Krocker's beg. Inventory. Sales revenue ✔ Cost of goods sold • To eliminate intercompany sales and purchases. Cost of goods sold 2,250 1,500,000 ✓ 0✓ 2,050 2.250 0✔ 1,500,000

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

Chapter22: Accounting For Changes And Errors.

Section: Chapter Questions

Problem 4RE: Refer to RE22-2. Assume Heller Company had sales revenue of 510,000 in 2019 and 650,000 in 2020....

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