Well Co. has a $20,000 receivable from Eight Co. and a $40,000 receivable from Cotten Corporation. Well also has a$30,000 payable to Sloane Co. Well owns 80% of Eight, 45% of Cotten, and 55% of Sloane. Eight and Sloane areconsolidated subsidiaries, and Cotten is an equity-basis investee. At what amounts should Well report these balances inthe consolidated financial statements?ReceivablesPayablesOA. $40,000$0○ B. $30,000$30,000C. $60,000$30,000O D. $0$0

Subsidiary Company:Subsidiary company means a company in which more than 50% equity is held by…

Answered: consolidated subsidiaries, and Cotten…

consolidated subsidiaries, and Cotten is an equity-basis investee. At what amounts should Well report these balances in the consolidated financial statements?

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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Question

Well Co. has a $20,000 receivable from Eight Co. and a $40,000 receivable from Cotten Corporation. Well also has a
$30,000 payable to Sloane Co. Well owns 80% of Eight, 45% of Cotten, and 55% of Sloane. Eight and Sloane are
consolidated subsidiaries, and Cotten is an equity-basis investee. At what amounts should Well report these balances in
the consolidated financial statements?
Receivables
Payables
OA. $40,000
$0
○ B. $30,000
$30,000
C. $60,000
$30,000
O D. $0
$0

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