Hi expart solve this accounting question Steven Inc. sold $219,000 in inventory to Thomas Co.during 20X0 for $300,000. Thomas resold $100,000 ofthis merchandise in 20XO with the remainder to bedisposed of during 20X1.Assume Steven owns 28% of Thomas and applies theequity method.1. Determine Steven's share of the unrealized gain at theend of 20X0.2. Prepare the journal entry Steven should record at theend of 20X0 to defer the unrealized intra-entry inventoryprofit.

Step 1: Define Unrealized GainAn unrealized gain is an increase in the asset value, however, the…

Answered: Steven Inc. sold $219,000 in inventory…

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

Chapter13: Investments And Long-term Receivables

Section: Chapter Questions

Problem 8RE

See similar textbooks

Similar questions

P1 is a one-third owner in ABC LLC. P1 sold his interest in ABC to B1 for $95,000 in cash (plus assumption of liabilities of ABC). Assume P1's inside and outside basis in ABC are equal. ABC's balance sheet at the dale of sale follows. Determine the amount and character of the gain or loss P1 will realize at the sale. ASSETS: Cash Receivables Inventory Land LIABILITIES AND CAPITAL: Liabilities Capital-P1 Capital-P2 Capital-P3 Tax Basis 60,000 60,000 120,000 120,000 70,000 130,000 50,000 55,000 300,000 365,000 30,000 90,000 90,000 90,000 FMV 300,000
Henry acquired 80% of Stephen on 1 July 2018. In the post-acquisition period Henry soldgoods to Stephen at a price of GHS12 million. These goods had cost Henry GHS9 million. During theyear to 31 March 2019, Stephen had sold GHS10 million (at cost to Stephen) of these goods forGHS15m million. How will this affect group cost of sales in the consolidated statement of profit or lossof Henry for the year ended 31 March 2019?A Increase by GHS11.5 millionB Increase by GHS9.6 millionC Decrease by GHS11.5 millionD Decrease by GHS9.6 million
Paulos Company purchases a controlling interest in Sanjoy Company. Sanjoy had identifiable net assets with a book value of $500,000 and a fair value of $800,000. It was agreed that the total fair value of Sanjoy’s common stock was $1,200,000. Use value analysis schedules to determine what adjustments will be made to Sanjoy’s accounts andwhat new accounts and amounts will be recorded if: a. Paulos purchases 100% of Sanjoy’s common stock for $1,200,000. b. Paulos purchases 80% of Sanjoy’s common stock for $960,000.
Brooks owns 30% of Ghost Inc. The following information pertains to an intra entity transfer. What is the journal entry for 12/31/20 and what is the journal entry in 2021 if the remaining inventory is sold? Make sure to date your journal entries. Year Cost to Ghost Price to Brooks (selling price) |12/31 (ending inventory bal. for Brooks) 2020 $42,000 $63,000 $15,000 BI E E P Format Date Account Debit Credit rate Windowr Dothi tohlo
Jubilee, Inc., owns 30 percent of JPW Company and applies the equity method. During the current year, Jubilee buys inventory costing $93,100 and then sells it to JPW for $133,000. At the end of the year, JPW still holds only $21,400 of merchandise. What amount of gross profit must Jubilee defer in reporting this investment using the equity method? Multiple Choice $4,926. $1,926. $12,726. $10,026.
High owns 60% of Low. In 2019, Low sold inventory (cost $70,000) to High for $100,000. 40% of this inventory was not sold to third parties by High by December 31, 2019. What is the amount of unrealized gain that must be reversed in the consolidated financial statements at December 31, 2019? (Worksheet entry: Dr. Cost of Goods Sold. Cr. Inventory)
Brooks owns 20% of Ghost Inc. The following information pertains to an intra entity transfer. What is the journal entry for 12/31 / 20 and what is the journal entry in 2021 if the remaining inventory is sold? Make sure t date your journal entries. Cost to Ghost is $52,000 . Price to Brooks (selling price ) is $72,000 . Ending inventory balance on 12/31 / 20 for Brooks is $ 15,000 .
(10) In a liquidating distribution, Janice Rand receives cash of $40,000, inventory (basis of $18,000 and FMV of $27,566) and land (basis of 15,000 and FMV of $250,000). Her basis in her interest of Yeoman LLC is $80,000. (a) What is her gain or loss on the distribution? (b) What is her basis in the inventory? (c) What is her basis in the land? (d) What if Yeoman LLC only distributed the cash and the inventory to Janice in exchange for her partnership interest? How much gain or loss will she recognize and what would be her basis in the inventory?
Viktor exchanges stock (adjusted basis $19,000, FMV $26,800) and real estate (adjusted basis $19,000, FMV $46,000) held for investment for other real estate to be held for investment. The real estate acquired in the exchange has a suggested FMV of $70,200. Required: a. What are Viktor's realized and recognized gain or loss? b. What is the basis of the acquired real estate? a a b. Realized gain No gain or loss Realized gain Realized loss Recognized gain Amount
X purchased 40% of Y on January 1,2019 for $400,000. Y paid dividends of $50,000 in each year. Y's income statements for 2019 and 2020 showed the following: 2019 2020 Income (loss) before income taxes $100,000 (60,000) Income tax expense (recovery) 40,000 (15,000) Net income (loss) $60,000 ($45,000) Other comprehensive income (net of tax) 20,000 25,000 Comprehensive income (loss) $80,000 ($20,000) At December 31, 2019, the fair value of the investment was $440,000 and at December 31, 2020, the fair value of the investment was $420,000. Required: Prepare X's journal entries for 2019 and 2020, assuming that is a significant influence investment.
On January 1, 20X1, Pepper purchased 70% interest in Salt for $420K. At the time of the purchase, Salt’s assets and liabilities were equal to book value except for Inventory, Building and Land (which had fair values in excess of book value of $10K, $30K and $45K respectively). Net Asset BV at the time of purchase was $440K. Included in the $420K purchase price was a covenant not to compete. The covenant was value at $30K and is for a two year period. At the time of the purchase, it was determined that the all of Salt’s depreciable assets had a remaining 5 year life and inventory had a 2 month life. The following events occurred during the year: Event #1 Salt sold inventory with an originally cost of $369K to Pepper for $450K. Pepper sold 70% to a third party for $600K and had 30% of the inventory remaining at the end of the year Event #2 On January 1, 20X1 Salt borrowed $750K from Pepper at 8% interest. Salt paid zero down on the principle during the year. However, Salt paid…
On January 1, 20X1, Pepper purchased 70% interest in Salt for $420K. At the time of the purchase, Salt’s assets and liabilities were equal to book value except for Inventory, Building and Land (which had fair values in excess of book value of $10K, $30K and $45K respectively). Net Asset BV at the time of purchase was $440K. Included in the $420K purchase price was a covenant not to compete. The covenant was value at $30K and is for a two year period. At the time of the purchase, it was determined that the all of Salt’s depreciable assets had a remaining 5 year life and inventory had a 2 month life. The following events occurred during the year: Event #1 Salt sold inventory with an originally cost of $369K to Pepper for $450K. Pepper sold 70% to a third party for $600K and had 30% of the inventory remaining at the end of the year Event #2 On January 1, 20X1 Salt borrowed $750K from Pepper at 8% interest. Salt paid zero down on the principle during the year. However, Salt paid…

SEE MORE QUESTIONS

Recommended textbooks for you

Intermediate Accounting: Reporting And Analysis

Accounting

ISBN:

9781337788281

Author:

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

Publisher:

Cengage Learning

SWFT Essntl Tax Individ/Bus Entities 2020

Accounting

ISBN:

9780357391266

Author:

Nellen

Publisher:

Cengage

SWFT Comprehensive Volume 2019

Accounting

ISBN:

9780357233306

Author:

Maloney

Publisher:

Cengage

Intermediate Accounting: Reporting And Analysis

Accounting

ISBN:

9781337788281

Author:

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

Publisher:

Cengage Learning

SWFT Essntl Tax Individ/Bus Entities 2020

Accounting

ISBN:

9780357391266

Author:

Nellen

Publisher:

Cengage

SWFT Comprehensive Volume 2019

Accounting

ISBN:

9780357233306

Author:

Maloney

Publisher:

Cengage

CONCEPTS IN FED.TAX., 2020-W/ACCESS

Accounting

ISBN:

9780357110362

Author:

Murphy

Publisher:

CENGAGE L

SEE MORE TEXTBOOKS