Squid Corporation, a 90% owned subsidiary of Penguin Corporation, sold inventory items to its parent for a profit of $24,000 in 2020. Penguin resold one-third of this inventory to outside entities. Squid reported net income of $100,000 for 2020. Minority interest income in the consolidated income statement for 2020 is

Squid Corporation, a 90% owned subsidiary of Penguin Corporation, sold inventory items to its parent for a profit of $24,000 in 2020. Penguin resold one-third of this inventory to outside entities. Squid reported net income of $100,000 for 2020. Minority interest income in the consolidated income statement for 2020 is

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter22: Accounting For Changes And Errors.

Section: Chapter Questions

Problem 2P

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Green Co. sold inventories on May 1, 2019 to its 75% owned subsidiary, Indigo Company. The inventories costing P188,000 were sold for a 25% gross profit Out of these inventories, sold to outsiders during 2019. In 2020, Green Co. reported net income of P430,000s and Indigo Co. reported net income of P280,000 How much of the consolidated net income is to be allocated to non- controlling interest in 2020? a.76, 267 b.74, 700 c.81,750 d. 70,000
G Company acquired inventories on October 18, 2020, from its 90% owned subsidiary, B Company. The inventories were sold for 178,000 including the 25% markup based on cost. Out of these inventories, 55% were unsold to outsiders. Based on the above transaction, compute the unrealized profit attributable to controlling interest in 2020.
What are the consolidated balances for? Cost of Goods Sold Net income attributable to non controlling Interest Information: ClipRite sold ProForm inventory costing $72,000 during the last six months of 2020 for $120,000. At year-end, 30 percent remained ClipRite sold ProForm inventory costing $200,000 during 2021 for 250,000. At yearend, 10% percent is left. Proform acquired 70 percent of ClipRite on June 30, 2020, for $910,00 in cash. Based on ClipRites acquistion-date fair value, an unrecorded intangible of $400,000 was recognized and is being amortized at the rate of $10,000 per year. No goodwill was recognized in the acuisition. The noncontrolling interest fair value was assessed at $390,000 at the acquisition date. The 2021 financial statements are as follows: Proform ClipRite Sales -800,000 -600,000 Costs of goods sold 535,000 400,000 Operating expenses 100,000 100,000 Dividend Income -35,000 Net Income -200,000 -100,000 Retained…
On April 1, 2021, BBC Co. acquired a 30% stake in LTI Inc. for $ 100,000. This amount includes $ 40,000 that represents the excess of the fair market value over the book value of the identifiable net assets that LTI Inc. had on its books as of that date. Of this difference of $ 40,000, BBC attributes that $ 15,000 is due to inventory that was sold in its entirety during 2021, and the remaining $ 25,000 is due to goodwill. On the other hand, LTI generated a net income of $ 20,000 for 2021, and paid dividends of $ 2,500 for each quarter. As a consequence of these effects on LTI's books and financial statements, BBC will recognize investment income (or loss) for a. $4,500 b. $1,125 c. $3,450 d. ($10,500)
Denzel Co. acquired inventories on May 1, 2021 from its 70% owned subsidiary, Martin Company. The inventories were sold for P188,000, including the 25% mark up on cost. Out of these inventories, 65% were sold to outsiders. During 2022, Denzel Co. reported net income of P430,000 and Martin Co. reported net income of P280,000. How much is the realized profit to be allocated to non-controlling interest in 2022?
Camille, Inc., sold $147,000 in inventory to Eckerle Company during 2020 for $245,000. Eckerle resold $109,000 of this merchandise in 2020 with the remainder to be disposed of during 2021. Assuming that Camille owns 34 percent of Eckerle and applies the equity method, what journal entry is recorded at the end of 2020 to defer the intra-entity gross profit?
On January 1, 2021, PCO purchased 70% ownership of SCO which resulted to a gain on acquisition of P100,000. Net assets of SCO were fairly valued except for inventory which was understated by P1,500,000. A third of these inventories remained unsold as of the end of the calendar year. The operations of the two companies for 2021 are as follows: In the consolidated statement of comprehensive income for the year ended December 31, 2021, how much is the cost of goods sold? a. 1,550,000 b. 1,850,000 c. 3,550,000 d. 3,250,000
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Pizza Factory Company owns 100% controlling interest in its long held subsidiary; The Sugar Company and they use the Equity Method. Pizza Factor sells inventory to Sugar Company for a 25% Gross Profit. During 2019 and 2020, intercompany sales amounted to: Intercompany Sales: 2019 840,000 2020 930,000 At the end of 2019, Sugar Company had one-fifth of the goods purchased that year from Pizza Factory in its ending inventory. At the end of 2020, Sugar Company's 2020 ending inventory contained one-fourth of that year’s purchases from Pizza Factory. There were no intercompany sales prior to 2019. Prepare in general journal form all entries necessary on the consolidated statements…
Jellicent Corporation is an 80% owned subsidiary of Frilish Corporation. During 2018, Jellicent sold merchandise that cost P120,000 to Frilish for P160,000. Frilish’s ending inventory at December 31, 2018 contained unrealized profit of P8,000 from the intercompany sales.During 2019, Jellicent sold merchandise that cost P140,000 to Frilish for P190,000. One-half of this remained unsold by Frilish at December 31, 2019. For 2019, Frilish’s separate income (does not include investment income) was P250,000 and Jellicent 's reported net income was P190,000. The consolidated net income attributable to parent for 2019 will be: *a. P356,000b. P388,400c. P342,500d. P377,500
What are the consolidated balances for? Cost of Goods Sold Net income attributable to non-controlling Interest ClipRite sold ProForm inventory costing $72,000 during the last six months of 2020 for $120,000. At year-end, 30 percent remained ClipRite sold ProForm inventory costing $200,000 during 2021 for $250,000. At yearend, 10% percent is left. Proform acquired 70 percent of ClipRite on June 30, 2020, for $910,000 in cash. Based on ClipRites acquisition-date fair value, an unrecorded intangible of $400,000 was recognized and is being amortized at the rate of $10,000 per year. No goodwill was recognized in the acquisition. The noncontrolling interest fair value was assessed at $390,000 at the acquisition date. The 2021 financial statements are as follows: Proform ClipRite Sales -800,000 -600,000 Costs of goods sold 535,000 400,000 Operating expenses 100,000 100,000 Dividend Income -35,000 Net Income…
Sansa Co. acquired 60% interest in Arya on January 1, 2025 for $46,800 when Arya's net assets had a book value equal to its fair value of $79,000. On the same year, Sansa sold inventory items costing $78,000 to Arya for $104,000 and Arya's inventory at December 31, 2025 included one-fourth of this merchandise. Sansa reported separate income from its own operations of $48,800, and Arya reported a net loss of $19,500 for the year. Compute for the consolidated net income,2025.