a) Prepare any necessary journal entries in the consolidation journal to adjust for this transaction during the year ended 30 June 20X2.Cost of goods soldDr(Eliminate the intra-group revenue/expense on the sale before tax)DrIncome tax expense→Cr(Adjust for tax effects of elimination of intra-group transaction)b) Prepare any necessary journal entries in the consolidation journal to adjust for this transaction during the year ended 30 June 20X3.DrCrC(Eliminate impact of prior year's intra-group transaction) Intra-group Transactions (C)Parent Ltd owns 100% of Subsidiary Ltd. In the financial year ended 30 June 20X2, Subsidiary Ltd sold inventory to Parent Ltd. Detailsregarding the transaction are as follows:Cost to Subsidiary to produce inventorySale price of inventory to Parent Ltd.Percentage of inventory still held by Parent Ltd at 30 June 20X2Percentage of inventory still held by Parent Ltd at 30 June 20X3Tax rate$7500$800010%0%30%Round all your answers to the nearest dollar amount. If you believe no journal entry is required, select NULL for the account name, NA forthe Dr or Cr, and enter 0 for the amount. Do not leave the amount blank.Do not enter dollar ($) signs or commas (i.e. enter 10000 not $10,000).The description may be missing from some of the journal entries below. This is intentional. Where journal descriptions are provided, youneed to read them carefully and be sure your answers are consistent with the provided description.REQUIRED:

Inter Group Transaction :— In a consolidation model, intercompany eliminations are used to remove…

Answered: a) Prepare any necessary journal…

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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match each item with one of the 6 classifications listed below:
Phone Corporation owns 80 percent of Smart Company's stock. At the end of 20X8, Phone and Smart reported the following partial operating results and inventory balances: Total sales Sales to Smart Company Sales to Phone Corporation Net income Operating income (excluding investment income from Smart) Inventory on hand, December 31, 20x8, purchased from: Smart Company Phone Corporation Phone Corporation $ 700,000 148,400 Amount of sales 77,000 49,680 Required: a. What amount of sales will be reported in the consolidated income statement for 20X8? Amount of cost of goods sold Smart Company $ 522,000 Phone regularly prices its products at cost plus a 40 percent markup for profit. Smart prices its sales at cost plus a 20 percent markup. The total sales reported by Phone and Smart include both intercompany sales and sales to nonaffiliates. 248,400 27,000 44,520 b. What amount of cost of goods sold will be reported in the 20X8 consolidated income statement? Note: Do not round intermediate…
When a component of a company's operations is classified as held for sale at the end of an accounting period, The component may not be reported as a discontinued operation until sold. The component will be reported on the balance sheet at the higher of its (1) fair value net of any costs to sell or (2) book value. The company may report the difference between the component's (1) fair value net of any costs to sell and (2) book value as a loss from discontinued operations on the income statement. None of these choices apply.
1. Sales journal must contain the following: * A) Date, Name and Address of Buyer, Sales Invoice or OR No. B) Name and Address of Buyer, Sales Exempted and RDO Number C) Total Invoice Amount, VAT Output Tax, and Date of when the amount is to be remitted to BIR D) None of the above. 2. Included in non-deductible interest expense are: * A) Interest paid in advance B) Interest treated as capital expenditures C) Interest on amortization D) All of the above 3. These are the data included in the Purchase Journal * A) Name and Address of Supplier, Date, Total Invoice Amount B) Name and Address of Buyer, Date, Total Invoice Amount C) Name and Address of Supplier, Date, VAT Output tax D) Name and Address of Supplier, Date, Delivery Receipt
S1: The amount of intercompany profit subject to elimination is calculated on the basis of the buyer's affiliate's gross profit rate stated as a percentage of cost. S2: Intercompany sales of inventory necessitate adjustments to the calculation of the distribution of income to the controlling interest. O Only S1 is correct. O Only S2 is correct. O Both statements are correct. O Both statements are incorrect.
Statement 1 : Expenses associated directly with revenue are matchedagainst revenue in those interim periods in which the related revenue isrecognized. Statement 2 : Inventory losses from permanent marketdeclines are recognized in the interim period in which the decline occurs.Recoveries of such losses on the same inventory in later interim periodshould be recognized as gains in the interim periods where the declineoccurred A. Only statement 1 is trueB. Only statement 2 is trueC. Both statements are falseD. Both statements are true
Assume Maple Corporation has just completed the third year of its existence (year 3). The table below indicates Maple's ending book inventory for each year and the additional §263A costs it was required to include in its ending inventory. Maple immediately expensed these costs for book purposes. In year 2, Maple sold all of its year 1 ending inventory, and in year 3 it sold all of its year 2 ending inventory. Ending book inventory Additional $263A costs Ending tax inventory Year 1 $ 2,400,000 60,000 $ 2,460,000 Year 2 $ 2,700,000 70,000 $ 2,770,000 Year 3. $ 2,040,000 40,000 $ 2,080,000 Required: a. What book-tax difference associated with its inventory did Maple report in year 1? Was the difference favorable or unfavorable? Was it permanent or temporary?
Answer both in detail
Please Introduction and explanation 1 and 2 question answers both subparts answer no plagiarism please and what is correct option and incorrect option why? Explanation please
State how each of the following items is reflected in thefinancial statements.(a) Change from FIFO to LIFO method for inventoryvaluation purposes.(b) Charge for failure to record depreciation in a previousperiod.(c) Litigation won in current year, related to prior period.(d) Change in the realizability of certain receivables.(e) Write-off of receivables.(f) Change from the percentage-of-completion to thecompleted-contract method for reporting net income.

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