Chapter 6, Problem 6.12E

(a)

To determine

Introduction: The consolidated net income is the difference between the sum of the total operating income of the parent company and the net income of the subsidiary and the unrealized inventory profits of the two.

The consolidated income for 20X4

(b)

To determine

Introduction: Inventory refers to the goods that a business holds with the ultimate goal of resale. It includes only the finished goods or unfinished goods to be ultimately used in the production process. It is classified as a current asset in the balance sheet of the company.

The inventory balance reported in the consolidated balance sheet for 20X5

(c)

To determine

Introduction: The cost of goods sold refers to the cost of acquisition of or manufacturing of goods that a company sells during a particular period. The cost of goods sold includes the cost of materials and labor used in the manufacturing and other associated costs.

The amount to be reported as cost of goods sold

(d)

To determine

Introduction: The income assigned to controlling interest is the difference between income assigned to non-controlling interest and the consolidated net income.

The amount reported as income assigned to the controlling interest.