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Required: 1. Assuming that the vehicle transfer was downstream, calculate Plock's consolidated net income for 2011, and controlling share of consolidated net income for 2011. 2. Assuming that the vehicle transfer was upstream, calculate Plock'

Required: 1. Assuming that the vehicle transfer was downstream, calculate Plock's consolidated net income for 2011, and controlling share of consolidated net income for 2011. 2. Assuming that the vehicle transfer was upstream, calculate Plock'

FINANCIAL ACCOUNTING
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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19) Plock Corporation, the 75% owner of Seraphim Company, reported net income of $400,000 in 2011, prior to recording any income from Seraphim. Seraphim reported net income for that same year of $80,000 on their stand-alone statements. During 2011, an intercompany sale of a vehicle resulted in a gain of $4,000, and the vehicle was assumed to have a four- year remaining useful life. The vehicle has no salvage value. Straight-line depreciation is used. Required: 1. Assuming that the vehicle transfer was downstream, calculate Plock's consolidated net income for 2011, and controlling share of consolidated net income for 2011. 2. Assuming that the vehicle transfer was upstream, calculate Plock'
Transcribed Image Text:19) Plock Corporation, the 75% owner of Seraphim Company, reported net income of $400,000 in 2011, prior to recording any income from Seraphim. Seraphim reported net income for that same year of $80,000 on their stand-alone statements. During 2011, an intercompany sale of a vehicle resulted in a gain of $4,000, and the vehicle was assumed to have a four- year remaining useful life. The vehicle has no salvage value. Straight-line depreciation is used. Required: 1. Assuming that the vehicle transfer was downstream, calculate Plock's consolidated net income for 2011, and controlling share of consolidated net income for 2011. 2. Assuming that the vehicle transfer was upstream, calculate Plock'
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