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S Corporation, a 75% owned subsidiary, of P Corporation, sells inventory items to its parent company at 125% of cost. Inventories of the affiliated companies for 2013 are as follows:     P                      S Beginning Inventory                 200,000           125,000 Ending Inventory                       250,000            100,000   P’s beginning and ending inventories include merchandise acquired from S of 75,000 and 100,000, respectively. If S’ reported net income is P150,000, P’s share in the subsidiary’s income is A. 230,000 B. 250,000 C. 330,000 D. 335,000

S Corporation, a 75% owned subsidiary, of P Corporation, sells inventory items to its parent company at 125% of cost. Inventories of the affiliated companies for 2013 are as follows:     P                      S Beginning Inventory                 200,000           125,000 Ending Inventory                       250,000            100,000   P’s beginning and ending inventories include merchandise acquired from S of 75,000 and 100,000, respectively. If S’ reported net income is P150,000, P’s share in the subsidiary’s income is A. 230,000 B. 250,000 C. 330,000 D. 335,000

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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S Corporation, a 75% owned subsidiary, of P Corporation, sells inventory items to its parent company at 125% of cost. Inventories of the affiliated companies for 2013 are as follows:

    P                      S

Beginning Inventory                 200,000           125,000

Ending Inventory                       250,000            100,000

 

P’s beginning and ending inventories include merchandise acquired from S of 75,000 and 100,000, respectively. If S’ reported net income is P150,000, P’s share in the subsidiary’s income is

A. 230,000

B. 250,000

C. 330,000

D. 335,000

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