Question 20Selected information from the separate and consolidated income statements of PosterCorporation and its subsidiary, Sign Company for the year ended December 31, 20x2are as follows:Poster Corp.Sign Co.ConsolidatedSalesP 600,000P 420,000P 924,000Cost of Goods Sold450,000335,000693,000Gross ProfitP 150,00085,000P 231,000During 2025, Poster Corporation sold goods to Sign Company at the same mark-up oncost that Poster uses for all sales. At December 31, 20x2, Sign had not paid all of thesegoods and still held 25% of them in inventory.What is the amount of intercompany sale of inventory?

Inter company sales are the sales made by the head office to their subsidiaries at a lower or equal…

Answered: m the separate and consolidated…

Business

Accounting

m the separate and consolidated sidiary, Sign Company for the year

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Related questions

Q: Suspect Company issued $720,000 of 10 percent first mortgage bonds on January 1, 20X1, at 103. The…

A: Journal entries are the chronologically ordered written records of a company's financial activities.…

Q: An entity shall determine whether a transaction or other event is a business combination by applying…

A: A transaction or event is determined as business combination if Assets and liabilities aquired…

Q: In the year a subsidiary sells land to its parent company at a gain, a workpaper entry is made…

A: The Work paper entry is the entry that is used to eliminate the impact of unearned profit which is…

Q: Assume that both the Parent and Subsidiary adopt 31 December as their financial year-end. Further…

A: SOLUTION- JOURNAL ENTRY IS THE ACT OF KEEPING OR MAKING RECORDS OF ANY TRANSACTIONS EITHER ECONOMIC…

Q: A parent company's journal entries to record a business combination with a subsidiary always include…

A: False. Only in the case of a direct buyout of the subsidiary's assets and liabilities, will it be…

Q: Exercise 8-24 (Algorithmic) (LO. S) The Parent consolidated group reports the following results for…

A: The question is based on the concept of consolidated financial statements.A consolidated financial…

Q: Which TWO of the following statements are correct when preparing consolidated financial…

A: The objective of the question is to identify the correct statements regarding the preparation of…

Q: Ifrs 10 Consolidatd financial statements sets out the requirements for the consolidation of entities…

A: Financial records known as consolidated financial statements show the assets, liabilities, equity,…

Q: Required A Required B Assume that this combination is a statutory merger so that On-the-Go's…

Q: Assume that both the Parent and Subsidiary adopt 31 December as their financial year-end. Further…

A: Intragroup transactions are transactions that occur between entities in the group. They can be…

Q: AGermansubsidiaryofaU.S.parentreportsitsaccountsineuros.Itsfunctionalcurrency,however,isthe…

A: The local currency accounts (euros) are changed to the functional currency (krona) by…

Q: On January 1, 2010, parent lends 70% owned subsidiary $5,000,000 at 6% annual interest for b. How…

A: Note: “Since you have posted a question with multiple sub-parts, we will solve first three sub-parts…

Q: On January 1, NewTune Company exchanges 19,681 shares of its common stock for all of the outstanding…

A: PART (a):- Calculation of goodwill/capital reserve:- (Amounts in $)ParticularsAmount ($)Fair Market…

Q: An entity shall determine whether a transaction or other event is a business com applying the…

A: An entity shall determine whether a transaction or other event is a business combination by…

Q: Select the correct answers from each drop-down menu. Who prepares a consolidated financial…

A: Consolidated balance sheet is a financial Statement that shows the financial position of the parent…

Q: Differentiate between a Chapter 7 liquidation and a Chapter 11reorganization.

A: Liquidation is mainly defined as selling off assets with proceeds distributed to creditors. But in…

Q: The absorption of one firm by another such that the acquired firm no longer exists as a separate…

A: The question is asking for the term that describes a situation where one company absorbs another…

Q: Statement I: A consolidation occurs when the entity that issues securities (the identified as the…

A: Business combination might be structured in many ways for the purpose of taxation as well as legal.

Q: In preparing the consolidation worksheet for a parent company and its foreign subsidiary, what…

A: Consolidated Balance Sheet: The consolidated balance sheet is the merger of the parent company…

Q: Which of the following accounting standards regulate the preparation and presentation of…

A: The purpose of the Indian Accounting Standard is to bring more transparency and accuracy to…

Q: How is the noncontrolling interest in a subsidiary company calculated as of the end of a reporting…

A: Definition: Non-controlling interest in a subsidiary company: The non-controlling interest does…

Q: Statement I: The revised PFRS 3 Business Combination was issued on January 2008. Statement II: An…

A: PFRS 3 is business combination standard.

Q: A, Sole proprietor, buy and sells product X. The taxable period of A shall be

A: All businesses are required to pay taxes and keep accounting records year by year. A sole proprietor…

Q: Debit Credit Current receivable due from Main Co. $ 32,000 Noncurrent receivable from Main Co.…

A: Intracompany receivables refer to the amount or services(current and non-current) which is…

Q: Peanut Company acquired 90 percent of Snoopy Company's outstanding common stock for $279,000 on…

A: Equity method is used to report investment of a company in another company. It is used in both US.…

Q: the following is hot a change in reporting entity? Multiple Choice Reporting using comparative…

A: Reporting entity is defined as the business unit with a responsibility to prepare the financial…

Q: Define each of the following terms:d. Operating merger; financial merger

A: Merger refers to the process whereby two or more companies come together to form a single entity. In…

Q: Consolidated financial statements: a. Consolidated financial statements provide information about…

A: Consolidated financial statements: When an investor company holds above 50% in the outstanding stock…

Q: Assume that both the Parent and Subsidiary adopt 31 December as their financial year-end. Further…

A: We’ll answer the first question since the exact one wasn’t specified. Please submit a new question…

Q: S1: Consolidated net income is equal to the parent’s income from its net income under its Income…

A: The question is multiple choice question and related with Consolidated Financial Statements.…

Q: Compute for the amount to be received by DEF in the final

A: Cash sales- ABC 4,590,000 Merchandise - DEF 272,250 Cash Sales-ABC 945,000 Less:…

Q: A subsidiary provided services to its parent during the current year, at a cost of $120,000. The…

A: The consolidation of financial statements requires the elimination of transactions between a parent…

Q: Assume that both the Parent and Subsidiary adopt 31 December as their financial year-end. Further…

A: SOLUTION- JOURNAL ENTRY IS USED TO RECORD A BUSINESS TRANSACTION IN THE ACCOUNTING RECORD OF A…

Q: adjustment for consolidated entry

A: If there are intra group transactions in a consolidated group of companies, the effect of the…

Q: A partially owned subsidiary sold a machine to its parent at a gain. In the year subsequent to the…

A: The question is related to Consolidation. In the given case subsidiary company sold a machine to its…

Q: interest Corpttal 'business in pars 2.006. p b. Nopart egueement was made u weillteh. They…

A: First of all, it is important to understand that whenever a partnership firm is formed, both the…

Q: Assume that both the Parent and Subsidiary adopt 31 December as their financial year-end. Further…

A: SOLUTION- JOURNAL ENTRY IS THE COMPANY'S OFFICIAL BOOK IN WHICH ALL TRANSACTIONS ARE RECORDED IN…

Q: In Bell Group's consolidation worksheet, the opening balance of retained earnings under 'group'…

A: Consolidation is the process of joining together smaller businesses, assets, or operations to form a…

Q: IF equipment account at 1/1/2019 was ( 50,000 for parents ,60,000 for subsidiary ) and at 31/12/2019…

A: The question is related to Consolidated Financial Statements. The balance of Equipment as on…

Q: What a consolidated financial statement is in accordance to MFRS 10 Consolidated Financial…

A: Consolidation financial statement Financial statements of a business having numerous divisions or…

Q: Examples of two or more companies that have gone through merger and acquisition in most recent years

A: Merger and acquisitions refer to the process where one company combines with another. In a merger,…

Question

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

SEE SOLUTION Check out a sample Q&A here

Step 1

VIEW

Step 2

VIEW

Step by step

Solved in 2 steps with 1 images

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.

Similar questions

CONS Group complies with IFRS 10 by consolidating the parent's financial statements at date December 31 with subsidiaries' financial statements at date June 30. Select one: True False
Compute for: a. Net income attributable to parent b. Non-controlling interest in net income
Assume that both the Parent and Subsidiary adopt 31 December as their financial year-end. Further assume that the transactions were conducted on cash basis. For each of the following independent scenarios in each of the independent parts: (1) Prepare all the relevant journal entries in the separate financial statements of the respective companies. (ii) Prepare all the relevant consolidation journal entries for the preparation of the consolidated financial statements of the Parent. (iii) Compare and contrast the accounting treatment/principles that you had applied in the independent scenarios in each part in preparing the journal entries and consolidation journal entries. Part A (a) On 20 December 20x1, a 90%-owned Subsidiary sold a piece of inventory which it bought for $200,000 to its Parent for $300,000. As at 31 December 20x1, that piece of inventory was still with the Parent and the net realisable value of the inventory was $250,000 on this date. (b) On 20 December 20x1, a Parent…
What is the journal entry for Subsidiary if it sold an inventory bought at $300 to its Parent company at a price of $200?
1) Merchandise invested by an entity under a joint operation agreement should include an entry of a)Debit to Joint Operation under the books of the Joint Operators other than the party who invested b)Credit to merchandise inventory of the Joint Operator who contributed merchandise c)Credit to merchandise Inventory of all the Joint Operators d)Credit to Joint Operation under the books of the party investing the merchandise 2) The interest of the retiring or withdrawing partner is usually measured by his capital balance before his retirement or withdrawal adjusted by the following adjustments except a)profit or loss after the date of the partner’s withdrawal or retirement b)changes in the valuation of all assets and liabilities c)errors in net income in prior years d)profit or loss from the operation from the last closing date of the date of his retirement or withdrawal 3)In case of admission of a partner, the first adjustment that need to be prepared is a) The…
The investment in subsidiary should be recorded on the parent’s book at?
ABC Company has several subsidiaries that are included in its consolidated financial statements. In its December 31, year 1 trial balance. ABC had the following intercompany balances before eliminations: In its December 31, year 1 consolidated balance sheet, what amount should ABC report as intercompany receivables?
Effects on consolidated financial statements of acquisition of affiliate's debt from non-affiliate On January 1, 2022, a Parent company has a debt outstanding that was originally issued at a discount and was purchased, on issuance, by an unaffiliated party. On January 1, 2022, a Subsidiary of the Parent purchased the debt from the unaffiliated party. The debt was purchased by the Subsidiary at a slight premium. The Parent is a calendar year company. Which one of the following statements is true? The consolidated balance sheet at December 31, 2022 will report none of the debt, and the consolidated income statement for the year ended December 31, 2022 will report a gain or loss from constructive retirement of the debt and will not report any interest expense from the debt. The consolidated balance sheet at December 31, 2022 will report the debt, and the consolidated income statement for the year ended December 31, 2022 will not report any interest expense from the debt. The consolidated…
All the financial statements is consolidated on the date of a business combination of a parent company and subsidiary Select one: True False
21