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Wrenten plc owns 65% of the voting shares of Arcanan plc and Arcanan plc is a subsidiary of Wrenten plc. The following is an extract from the most recent Income Statements of the two companies: Wrenten Arcanan plc plc £ £ Revenue 502 782 less Cost of Sales 377 626 Gross Profit 125 156 During the financial year Wrenten plc sold goods to Arcanan plc for £160. These goods cost Wrenten plc £112. All of these goods had been sold by Arcanan plc by the end of the financial year. What will be reported as Cost of Sales in Wrenten plc's Consolidated Income Statement?

Wrenten plc owns 65% of the voting shares of Arcanan plc and Arcanan plc is a subsidiary of Wrenten plc. The following is an extract from the most recent Income Statements of the two companies: Wrenten Arcanan plc plc £ £ Revenue 502 782 less Cost of Sales 377 626 Gross Profit 125 156 During the financial year Wrenten plc sold goods to Arcanan plc for £160. These goods cost Wrenten plc £112. All of these goods had been sold by Arcanan plc by the end of the financial year. What will be reported as Cost of Sales in Wrenten plc's Consolidated Income Statement?

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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Wrenten plc owns 65% of the voting shares of Arcanan plc and Arcanan plc is a subsidiary of Wrenten plc. The following is an extract from the most recent Income Statements of the two companies: Wrenten Arcanan plc plc £ Revenue 502 782 less Cost of Sales 377 626 Gross Profit 125 156 During the financial year Wrenten plc sold goods to Arcanan plc for £160. These goods cost Wrenten plc £112. All of these goods had been sold by Arcanan plc by the end of the financial year. What will be reported as Cost of Sales in Wrenten plc's Consolidated Income Statement?
Transcribed Image Text:Wrenten plc owns 65% of the voting shares of Arcanan plc and Arcanan plc is a subsidiary of Wrenten plc. The following is an extract from the most recent Income Statements of the two companies: Wrenten Arcanan plc plc £ Revenue 502 782 less Cost of Sales 377 626 Gross Profit 125 156 During the financial year Wrenten plc sold goods to Arcanan plc for £160. These goods cost Wrenten plc £112. All of these goods had been sold by Arcanan plc by the end of the financial year. What will be reported as Cost of Sales in Wrenten plc's Consolidated Income Statement?
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