Dysabel Corp. owns 80% of Marina, Inc.'s common stock. During 2020, Dysabel sold Marina P337,500 of inventory on the same terms as sales made to third parties. Marina sold all of the inventory purchased from Dysabel in 2020. The following information pertains to Marina and Dysabel's sales for 2020: Dysabel P1,350,000 540,000 P 810,000 Marina P945,000 472,500 P474,500 Sales. Cost of sales . What amount should Dysabel report as Cost of sales in its 2020 consolidated income statement? O 580,500 O 1,012,500 O 918,000 O 675,000

Dysabel Corp. owns 80% of Marina, Inc.'s common stock. During 2020, Dysabel sold Marina P337,500 of inventory on the same terms as sales made to third parties. Marina sold all of the inventory purchased from Dysabel in 2020. The following information pertains to Marina and Dysabel's sales for 2020: Dysabel P1,350,000 540,000 P 810,000 Marina P945,000 472,500 P474,500 Sales. Cost of sales . What amount should Dysabel report as Cost of sales in its 2020 consolidated income statement? O 580,500 O 1,012,500 O 918,000 O 675,000

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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The following are several figures reported for Allister and Barone as of December 31, 2021: Inventory Sales Investment income Cost of goods sold Operating expenses Allister Barone $ 530,000 $ 330,000 860,000 1,060,000 not given 530,000 245,000 430,000 315,000 Allister acquired 90 percent of Barone in January 2020. In allocating the newly acquired subsidiary's fair value at the acquisition date, Allister noted that Barone had developed a customer list worth $62,000 that was unrecorded on its accounting records and had a four-year remaining life. Any remaining excess fair value over Barone's book value was attributed to goodwill. During 2021, Barone sells inventory costing $133,000 to Allister for $186,000. Of this amount, 10 percent remains unsold in Allister's warehouse at year-end. Determine balances for the following items that would appear on Allister's consolidated financial statements for 2021:
Anderson Company, a 90% owned subsidiary of Philbin Corporation, transfers inventory to Philbin at a 25% gross profit rate. The following data are available pertaining specifically to Philbin's intra-entity purchases from Anderson. Anderson was acquired on january 1, 2020. 2020 2021 2022 Purchases by Philbin Ending inventory on Philbin's books 1,200 4,000 $ ৪,000 5 12,000 $15.000 3,000 Assume the equity method is used. The following data are available pertaining to Anderson's income and dividends. 2020 2021 2022 $ 70,000 $ 85,000 $ 94,000 Dividends paid by Anderson 10,000 10,000 15,000 Anderson's net income Assuming there are no excess amortizations associated with the consolidation, and no other intra-entity asset transfers, compute the net income attributable to the noncontrolling interest of Anderson for 2022. O $9,400. $9,375. $9,425. $8,485. $9,325.
15. Northridge, Inc., buys 40% of Matador Company on January 1, 2019. for $550,000. The equity method of accounting is to be used, Matador's net assets on that date were $1.2 million. Any excess of cost over book value is attributable to a trade name with a 20-year remaining life. Matador immediately begins supplying inventory to Northridge as follows: Amount Held by Northridge Year Cost to Matador Transfer Price At Year End (at transfer price)2019 $70,000 $100,000 $25,0002020 $96,000 $150,000 $45,000Inventory held at the end of one year by Northridge is sold at the beginning of the next. Matador reports net income of $100,000 in 2019 and $150.000 in 2020 and declares (and pays)…
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Francis acquired 80% of Cole’s Co. equity shares for $300,000 on January 1, 2018. On 31 December 2018 Francis sold $100,000.00 worth of goods to Cole’s. These goods had cost Francis $80,000.00. On December 31, 2018, Cole still had 20% of worth of goods remaining in inventory (held at cost to Cole). The two companies draft income statements as at 31 December 2018 are shown below. Francis Cole’s $'000 $'000 Revenue 5,000.00 1,000.00 Cost of sales (2,900.00) (600.00) Gross profit 2,100.00 400.00 Administrative expense (1,000.00) (200.00) Distribution costs (700.00) (120.00) Profit before tax 400.00 80.00 Income tax expense (130.00) (25.00) Profit for the year 270.00 55.00 Required Prepare the consolidated income statement to incorporate Francis and Cole for the year ended 31 December 2018. Note: Show all workings
On January 1, 2020, Abbey acquires 90 percent of Benjamin's outstanding shares. Financial information for these two companies for the years 2020 and 2021 follows (credit balances indicated by parentheses): 2020 2021 Abbey Company: Sales $ (698,000 ) $ (1,000,000 ) Operating expenses 468,000 524,000 Intra-entity gross profits in ending inventory (included in above figures) (159,000 ) (171,000 ) Dividend income—Benjamin Company (9,000 ) (40,500 ) Benjamin Company: Sales (250,000 ) (289,000 ) Operating expenses 133,000 151,000 Dividends paid (10,000 ) (45,000 ) Assume that a tax rate of 21 percent is applicable to both companies. On consolidated financial statements for 2021, what are the income tax expense and the income tax currently payable if Abbey and Benjamin file a consolidated tax return as an affiliated group? On consolidated financial statements for 2021, what are the income…
Alex, Inc., buys 40 percent of Steinbart Company on January 1, 2020, for $530,000. The equity method of accounting is to be used. Steinbart’s net assets on that date were $1.2 million. Any excess of cost over book value is attributable to a trade name with a 20-year remaining life. Steinbart immediately begins supplying inventory to Alex as follows: Year Cost to Steinbart Transfer Price Amount Held by Alex at Year-End (at transfer price) 2020 70,000 100,00 25,000 2021 96,000 150,000 45,000 Inventory held at the end of one year by Alex is sold at the beginning of the next. Steinbart reports net income of $80,000 in 2020 and $110,000 in 2021 and declares $30,000 in dividends each year. What is the equity income in Steinbart to be reported by Alex in 2021? How do you get the answer and how do you get trade name price? a. $34,050 b. $38,020 c. $46,230 d. $51,450
Claire Corporation owns 80% of Jerald, Inc. ordinary stock. During 2020, Claire sold Jerald for P150,000 of inventory on the same terms as sales made to third parties. Jerald sold 60% of the inventory purchased from Claire in 2020.The following information pertains to Claire and Jerald's sales for 2020: Claire JeraldSales P1,000,000 P700,000Cost of Sales 400,000 350,000What amount should Claire report as sales in its 2020 consolidated income statement
L Company owns 30% of S Company’s common stock which gives it the ability to apply significant influence and thus uses the equity method of accounting for its investment. During 2020 L Company sold inventory costing $120,000 to S company for $200,000. Also during 2020 S company resold $85,000 of this inventory to third parties. What journal entry would L Company make at the end of 2020 to defer the intra-entity gross profit?
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…
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On January 1, 2020, Abbey acquires 90 percent of Benjamin's outstanding shares. Financial information for these two companies for the years 2020 and 2021 follows (credit balances indicated by parentheses): 2020 2021 Abbey Company: Sales $ (732,000 ) $ (1,034,000 ) Operating expenses 532,000 628,000 Intra-entity gross profits in ending inventory (included in above figures) (195,000 ) (238,000 ) Dividend income—Benjamin Company (13,500 ) (31,500 ) Benjamin Company: Sales (296,000 ) (323,000 ) Operating expenses 126,000 154,000 Dividends paid (15,000 ) (35,000 ) Assume that a tax rate of 21 percent is applicable to both companies. On consolidated financial statements for 2021, what are the income tax expense and the income tax currently payable if Abbey and Benjamin file a consolidated tax return as an affiliated group? On consolidated financial statements for 2021, what are the income…