Baelfire Corporation owns an 80% interest in Sheriff Corporation acquired several years ago. Sheriff regularly sells merchandise to its parent at 125% of Sheriff's cost. Gross profit data of Baelfire and Sheriff for the year 2020 are as follows: Baelfire P650,000 Sheriff P520,000 416,000 P104,000 Sales . Cost of goods sold . Gross profit . 520,000 P 130,000 During 2020, Baelfire purchases inventory items from Sheriff at a transfer price of P260,000. Baelfire's December 31, 2019 and 2020 inventories included goods acquired from Sheriff of P65,000 and P81,250, respectively. The Unrealized profits in the year-end 2019 and 2020 inventories were:

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
icon
Related questions
Question

a. 520,000 and 65,000 respectively

b. 30,400 and 13,000 respectively

c. 65,000 and 81,250 respectively

d. 13,000 and 16,250 respectively

Baelfire Corporation owns an 80% interest in Sheriff Corporation acquired several years ago.
Sheriff regularly sells merchandise to its parent at 125% of Sheriff's cost. Gross profit data of
Baelfire and Sheriff for the year 2020 are as follows:
Baelfire
P650,000
Sheriff
Sales .
P520,000
Cost of goods sold
Gross profit .
520,000
416,000
P 130,000
P104,000
During 2020, Baelfire purchases inventory items from Sheriff at a transfer price of
P260,000. Baelfire's December 31, 2019 and 2020 inventories included goods acquired from
Sheriff of P65,000 and P81,250, respectively.
The Unrealized profits in the year-end 2019 and 2020 inventories were:
Transcribed Image Text:Baelfire Corporation owns an 80% interest in Sheriff Corporation acquired several years ago. Sheriff regularly sells merchandise to its parent at 125% of Sheriff's cost. Gross profit data of Baelfire and Sheriff for the year 2020 are as follows: Baelfire P650,000 Sheriff Sales . P520,000 Cost of goods sold Gross profit . 520,000 416,000 P 130,000 P104,000 During 2020, Baelfire purchases inventory items from Sheriff at a transfer price of P260,000. Baelfire's December 31, 2019 and 2020 inventories included goods acquired from Sheriff of P65,000 and P81,250, respectively. The Unrealized profits in the year-end 2019 and 2020 inventories were:
Expert Solution
trending now

Trending now

This is a popular solution!

steps

Step by step

Solved in 2 steps

Blurred answer
Knowledge Booster
Income Statement Analysis
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.
Similar questions
  • SEE MORE QUESTIONS
Recommended textbooks for you
FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
Accounting
ISBN:
9781259964947
Author:
Libby
Publisher:
MCG
Accounting
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education