3. 4. 5. Assume Weisman uses the equity method to account for its investment in Martindale. What is the balance in the pre-consolidation Income (loss) from subsidiary account for 2021? $136,000 $140,800 a. b. C. d. Assume Weisman uses the equity method to account for its investment in Martindale. What is the balance in pre-consolidation Income (loss) from subsidiary for 2022? a. b. $141,600 $142,800 C. d. $235,000 $264,600 $265,400 $268,600 What would be the net debit or credit to cost of goods sold on the 2021 consolidation worksheet?

3. 4. 5. Assume Weisman uses the equity method to account for its investment in Martindale. What is the balance in the pre-consolidation Income (loss) from subsidiary account for 2021? $136,000 $140,800 a. b. C. d. Assume Weisman uses the equity method to account for its investment in Martindale. What is the balance in pre-consolidation Income (loss) from subsidiary for 2022? a. b. $141,600 $142,800 C. d. $235,000 $264,600 $265,400 $268,600 What would be the net debit or credit to cost of goods sold on the 2021 consolidation worksheet?

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Concept explainers

Consolidation

Consolidation in general examination implies an asset oscillating between well-defined methods of trading status. Consolidation is commonly known as market indecisiveness, which completes when the asset's values move forward or backward the trading structure.

Question

Weisman Company, a 100% owned subsidiary of Martindale Corporation, sells inventory to Martindale at
a 20% profit on selling price. The following data are available pertaining to inter-company purchases by
Martindale:
4.
5.
a.
b.
Weisman's profit numbers were $125,000, $142,000 and $265,000 for 2020, 2021, and 2022,
respectively. Martindale received dividends from Weisman of $25,000 for 2020 and 2021, and $30,000
for 2022.
C.
d.
3. Assume Weisman uses the equity method to account for its investment in Martindale. What is the
balance in the pre-consolidation Income (loss) from subsidiary account for 2021?
$136,000
a.
b.
Inter-company sales
$18,000
$19,400
$21,500
C.
d.
2020:
2021:
2022:
a.
b.
C.
d.
$140,800
$141,600
$142,800
Assume Weisman uses the equity method to account for its investment in Martindale. What is the
balance in pre-consolidation Income (loss) from subsidiary for 2022?
Unsold at year end
(based on selling price)
2020:
2021:
2022:
$235,000
$264,600
$265,400
$268,600
$4,000
$6,000
$8,000
What would be the net debit or credit to cost of goods sold on the 2021 consolidation worksheet?
$19,000 credit
$19,800 credit
$21,400 credit
$ 400 debit

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Step 1: Introduction to pre-consolidation income

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Step 2: 3. Computation of pre-consolidation income from subsidiary for 2021

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Step 3: 4. Computation of pre-consolidation income from subsidiary for 2022

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Step 4: 5. Computation of the net adjustment to the cost of goods sold

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