Lorn Corporation purchased inventory from Dresser Corporation for P 120,000 on September 20, 20x2, and resold 80% of the purchased inventory to unaffiliated companies prior to December 31, 20x2, for P140,000. Dresser produced the inventory sold to Lorn for P75,000. Lorn owns 70% of Dresser’s voting common stock. The companies had no other transactions during 20x2. 1. What amount of sales will be reported in the 20x2 consolidated income statement? A. P98,000 C. P140, 000 B. P120, 000 D. P260, 000 2. What amount of cost of goods sold will be reported in the 20x2 consolidated income statement? A. P60,000 C. P96, 000 B. P75, 000 D. P120, 000 E. P171, 000 3. What amount of consolidated net income will be assigned to the controlling interest for 20x2? A. P20,000 D. P45, 000 B. P30, 800 E. 69, 200 C. P44, 000 F. 80, 000
Lorn Corporation purchased inventory from Dresser Corporation for P 120,000 on September 20, 20x2, and resold 80% of the purchased inventory to unaffiliated companies prior to December 31, 20x2, for P140,000. Dresser produced the inventory sold to Lorn for P75,000. Lorn owns 70% of Dresser’s voting common stock. The companies had no other transactions
during 20x2.
1. What amount of sales will be reported in the 20x2 consolidated income statement?
A. P98,000 C. P140, 000
B. P120, 000 D. P260, 000
2. What amount of cost of goods sold will be reported in the 20x2 consolidated income statement?
A. P60,000 C. P96, 000
B. P75, 000 D. P120, 000
E. P171, 000
3. What amount of consolidated net income will be assigned to the controlling interest for 20x2?
A. P20,000 D. P45, 000
B. P30, 800 E. 69, 200
C. P44, 000 F. 80, 000
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