Make the necessary elimination entries Compute consolidated sales and cost of goods

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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Top Company holds 90 percent of Bottom Company’s common stock. In the current year, Top reports sales of $800,000 and cost of goods sold of $600,000. For this same period, Bottom has sales of $300,000 and cost of goods sold of $180,000. During the current year, Top sold merchandise to Bottom for $100,000. The subsidiary still possesses 40 percent of this inventory at the current year end. Required: Make the necessary elimination entries Compute consolidated sales and cost of goods sold Bellgrade, Inc., acquired a 60 percent interest in Hansen Company several years ago. During 2011, Hansen sold inventory costing $75,000 to Bellgrade for $100,000. A total of 16 percent of this inventory was not sold to outsiders until 2012. During 2012, Hansen sold inventory costing $96,000 to Bellgrade for $120,000. A total of 35 percent of this inventory was not sold to outsiders until 2013. In 2012, Bellgrade reported cost of goods sold of $380,000 while Hansen reported $210,000. Required: Make elimination entries Compute consolidated cost of goods sold in 2012
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