TechGear Inc., a subsidiary, sells merchandise to its parent company, NeoWare Corp., at a markup of 20% on cost. NeoWare's beginning inventory inventory includes $24,000 worth of merchandise purchased from TechGear. During the year, TechGear sells merchandise with a retail value of $400,000 to NeoWare. At year-end, NeoWare's inventory includes $36,000 worth of merchandise purchased from TechGear. Eliminations for intercompany merchandise sales result in a net effect of decreasing ending inventory by what amount? A) $6,000 B) $7,200 C) $8,000 D) $9,000

TechGear Inc., a subsidiary, sells merchandise to its parent company, NeoWare Corp., at a markup of 20% on cost. NeoWare's beginning inventory inventory includes $24,000 worth of merchandise purchased from TechGear. During the year, TechGear sells merchandise with a retail value of $400,000 to NeoWare. At year-end, NeoWare's inventory includes $36,000 worth of merchandise purchased from TechGear. Eliminations for intercompany merchandise sales result in a net effect of decreasing ending inventory by what amount? A) $6,000 B) $7,200 C) $8,000 D) $9,000

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

Chapter5: The Income Statement And The Statement Of Cash Flows

Section: Chapter Questions

Problem 3RE: Shaquille Corporation began the current year with inventory of 50,000. During the year, its...

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