ADVANCED ACCOUNTING >CUSTOM<
14th Edition
ISBN: 9781265537012
Author: Hoyle
Publisher: MCG CUSTOM
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Chapter 5, Problem 2Q
To determine
Find the amount of these sales which would be eliminated in consolidated financial statements.
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Choose the correct. Aceton Corporation owns 80 percent of the outstanding stock of Voctax, Inc. During the current year, Voctax made $140,000 in sales to Aceton. How does this transfer affect the consolidated statement of cash flows?a. The transaction should be included if payment has been made.b. Only 80 percent of the transfers should be included because the subsidiary made the sales.c. Because the transfers were from a subsidiary organization, the cash flows are reported as investing activities.d. Because of the intra-entity nature of the transfers, the amount is not reported in the consolidated cash flow statement.
Barker Company owns 80 percent of the outstanding voting stock of Walden Company. During the current year, intra-entity sales amount to $100,000. These transactions were made with a gross profit rate of 40 percent of the transfer price. In consolidating the two companies, what amount of these sales would be eliminated?
In a split - off transaction, if the subsidiary's book value is $150 million, and the parent company decides to distribute 80% of the subsidiary's book value to the shareholders of the new entity, how much will a shareholder holding 100 shares in the new entity receive in cash? Assume that the company has 1.25 million shares outstanding.
Chapter 5 Solutions
ADVANCED ACCOUNTING >CUSTOM<
Ch. 5 - Prob. 1QCh. 5 - Prob. 2QCh. 5 - Prob. 3QCh. 5 - Prob. 4QCh. 5 - James, Inc., sells inventory to Matthews Company,...Ch. 5 - Prob. 6QCh. 5 - Prob. 7QCh. 5 - Prob. 8QCh. 5 - Prob. 9QCh. 5 - Prob. 10Q
Ch. 5 - Prob. 11QCh. 5 - Prob. 12QCh. 5 - Prob. 13QCh. 5 - Prob. 1PCh. 5 - Prob. 2PCh. 5 - Prob. 3PCh. 5 - Prob. 4PCh. 5 - Prob. 5PCh. 5 - Prob. 6PCh. 5 - Prob. 8PCh. 5 - Prob. 11PCh. 5 - What is the total of consolidated cost of goods...Ch. 5 - Prob. 13PCh. 5 - Prob. 14PCh. 5 - Prob. 15PCh. 5 - What is the consolidated total for inventory at...
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