In May 2017, o parent sola inventories to a subsiaiary entity for $60 000. The inventories nao previoUsty cost the parent entity $43 000. Tne entire inventory is still held by the subsiaiary at reporting ate, 30 June 2017. ignoring tax effects, wnich of the following is the oojustment entry in the consolidation worKsheet at reporting aate?
In May 2017, o parent sola inventories to a subsiaiary entity for $60 000. The inventories nao previoUsty cost the parent entity $43 000. Tne entire inventory is still held by the subsiaiary at reporting ate, 30 June 2017. ignoring tax effects, wnich of the following is the oojustment entry in the consolidation worKsheet at reporting aate?
Intermediate Accounting: Reporting And Analysis
3rd Edition
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Chapter8: Inventories: Special Valuation Issues
Section: Chapter Questions
Problem 13RE: Refer to the information provided in RE8-4. If Paul Corporations inventory at January 1, 2019, had a...
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![In May 2017, o parent sold inventories to a subsiaiary entity for $50 000. The inventories had previously cost the
parent entity $48 000. The entire inventory is still neld by the subsiaiary at reporting date, 30 June 2017. Ignoring
tax effects, which of the following is the adjustment entry in the consolidation worksheet at reporting aate?
Select one:
a.
Cost of sales
Dr
60 000
Sales revenue
Cr
12 000
Inventories
Cr
48 000
b.
Sales revenue
Dr
48 000
Cash
Cr
48 000
Inventories
Dr
48 000
Cost of sales
Cr
48 000
C.
Cash
Dr
48 000
Sales revenue
Cr
48 000
Cost of sales
Dr
48 000
Inventories
Cr
48 000
d.
Sales revenue
Dr
60 000
Cost of sales
Cr
48 000
Inventories
Cr
12 000](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F532eb3ab-fed8-4608-beb7-b355120a0266%2F1df0f955-8a36-410c-abea-0907d6fbe0a5%2Flki2q8_processed.jpeg&w=3840&q=75)
Transcribed Image Text:In May 2017, o parent sold inventories to a subsiaiary entity for $50 000. The inventories had previously cost the
parent entity $48 000. The entire inventory is still neld by the subsiaiary at reporting date, 30 June 2017. Ignoring
tax effects, which of the following is the adjustment entry in the consolidation worksheet at reporting aate?
Select one:
a.
Cost of sales
Dr
60 000
Sales revenue
Cr
12 000
Inventories
Cr
48 000
b.
Sales revenue
Dr
48 000
Cash
Cr
48 000
Inventories
Dr
48 000
Cost of sales
Cr
48 000
C.
Cash
Dr
48 000
Sales revenue
Cr
48 000
Cost of sales
Dr
48 000
Inventories
Cr
48 000
d.
Sales revenue
Dr
60 000
Cost of sales
Cr
48 000
Inventories
Cr
12 000
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