Goddy Company owns 80% of the common stock of Morris, Inc. In the current year, Goddy reports sales of $10,000,000 and cost of goods sold of $7,500,000. For the same period, Morris has sales of $200,000 and cost of goods sold of $160,000. During the year, Goddy sold merchandise to Morris for $60,000 at a price based on the normal markup. At the end of the year, Morris still possesses 30 percent of this inventory. Compute consolidated cost of goods so ld. Select one: a. $7,604,500. b. $7,500,000. c. $7,660,000. d. $7,615,000. e. $7,600,000.
Goddy Company owns 80% of the common stock of Morris, Inc. In the current year, Goddy reports sales of $10,000,000 and cost of goods sold of $7,500,000. For the same period, Morris has sales of $200,000 and cost of goods sold of $160,000. During the year, Goddy sold merchandise to Morris for $60,000 at a price based on the normal markup. At the end of the year, Morris still possesses 30 percent of this inventory. Compute consolidated cost of goods so ld. Select one: a. $7,604,500. b. $7,500,000. c. $7,660,000. d. $7,615,000. e. $7,600,000.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Goddy Company owns 80% of the common stock of Morris, Inc. In the current year, Goddy reports sales of $10,000,000 and cost of goods sold of $7,500,000. For the same period, Morris has sales of $200,000 and cost of goods sold of $160,000. During the year, Goddy sold merchandise to Morris for $60,000 at a price based on the normal markup. At the end of the year, Morris still possesses 30 percent of this inventory.
Compute consolidated cost of goods so
ld. Select one:
a. $7,604,500.
b. $7,500,000.
c. $7,660,000.
d. $7,615,000.
e. $7,600,000.
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