RAM, Inc., acquired a 60 percent interest in LMU Company several years ago. During 2017, LMU sold inventory costing $160,000 to RAM for $200,000. A total of 18 percent of this inventory was not sold to outsiders until 2018. During 2018, LMU sold inventory costing $297,500 to RAM for $350,000. A total of 30 percent of this inventory was not sold to outsiders until 2019. In 2018, RAM reported cost of goods sold of $607,500 while LMU reported $450,000. What consolidation entries will be made for these transactions in 2018 consolidation?

RAM, Inc., acquired a 60 percent interest in LMU Company several years ago. During 2017, LMU sold inventory costing $160,000 to RAM for $200,000. A total of 18 percent of this inventory was not sold to outsiders until 2018. During 2018, LMU sold inventory costing $297,500 to RAM for $350,000. A total of 30 percent of this inventory was not sold to outsiders until 2019. In 2018, RAM reported cost of goods sold of $607,500 while LMU reported $450,000. What consolidation entries will be made for these transactions in 2018 consolidation?

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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