Advanced Accounting
12th Edition
ISBN: 9781305084858
Author: Paul M. Fischer, William J. Tayler, Rita H. Cheng
Publisher: Cengage Learning
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Chapter 4, Problem 3UTI
To determine
To determine:.Distribution of profit to the controlling and noncontrolling interest in year 2015 and 2016.
Introduction: Consolidation is a process in which financial statements of subsidiary is merged with financial statements of the parent. In this process, effect of intercompany transactions are eliminated.
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S Ltd(a partially owned subsidiary), sold inventories for the first time to its parent, P Itd during the reporting period ended 28 February 2015, at a profit mark up of 25% on cost
price. On 28 February 2015 inventories to the value of R100 000 (at cost to P Ltd) were still on hand. The company tax rate is 28%. Total sales from S Ltd to P Ltd for the current
reporting period amounted to R200 000.
What are the correct journal entries for elimination of intragroup sales?
Select one:
O a. Dr Cost of sales R200 000(P), Cr Revenue(S) P/L R200 000
O b. Dr Revenue(S) (P/L) R200 000, Cr Cost of sales(P) R200 000
O . Dr Revenue(S)P/L R100 000, Cr Cost of sales(P) R100 000
O d. Dr Revenue(P) P/L R200 000 Cr Cost of sales(P)R200 000
S Ltd(a partially owned subsidiary), sold inventories for the first time to its parent, P Itd during the reporting period ended 28 February 2015, at a profit mark up of 25% on cost
price. On 28 February 2015 inventories to the value of R100 000(at cost to P Ltd) were still on hand. The company tax rate is 28%.
Total sales from S Ltd to P Ltd for the current reporting period amounted to R200 000.
Which is the correct tax implication on unrealized profit?
Select one:
O a. Dr Deferred tax (S)SFP R5 600, Cr Income Tax expense (S) P/L R5 600
O b. Dr Deferred tax (S) SFP R7 000, Cr Income tax expense (S) P/L R 7 000
O c Dr Income tax expense(S) P/L R5 600, Cr Deferred tax (5) SFP R5 600
O d. Dr Income tax expense (S) P/L R2 800, Cr Deferred tax (S) R2 800
Presented below is information related to Sunland Company as of and for the year ended December 31, 2017. This was Sunland
Company's first year of operations. (Ignore income tax effects.)
Sales revenue
$ 1,380,000
Cost of goods sold
700,000
Selling and administrative expenses
320,000
Loss on sale of plant assets
68,000
Unrealized gain on available-for-sale investments
17,000
Interest expense
5,800
Interest revenue
3,900
Loss on discontinued operations
2,600
Allocation to noncontrolling interest
8,700
Div
declared and paid
27,200
Chapter 4 Solutions
Advanced Accounting
Ch. 4 - Prob. 1UTICh. 4 - Prob. 2UTICh. 4 - Prob. 3UTICh. 4 - Prob. 4UTICh. 4 - Prob. 5UTICh. 4 - Prob. 6UTICh. 4 - Sorel is an 80%-owned subsidiary of Pattern...Ch. 4 - Hide Corporation is a wholly owned subsidiary of...Ch. 4 - Prob. 2.2ECh. 4 - Prob. 3E
Ch. 4 - On January 1, 2016, Jungle Company sold a machine...Ch. 4 - Prob. 4.2ECh. 4 - Prob. 4.3ECh. 4 - Prob. 5.1ECh. 4 - Prob. 5.2ECh. 4 - Prob. 6ECh. 4 - Prob. 7ECh. 4 - Prob. 8ECh. 4 - Prob. 9.1ECh. 4 - Prob. 9.2ECh. 4 - Prob. 10.1ECh. 4 - Prob. 10.2ECh. 4 - Prob. 4.1PCh. 4 - Prob. 4.2.1PCh. 4 - Prob. 4.2.2PCh. 4 - Prob. 4.3.1PCh. 4 - Prob. 4.3.2PCh. 4 - Prob. 4.4.1PCh. 4 - Prob. 4.4.2PCh. 4 - Prob. 4.7.1PCh. 4 - Prob. 4.7.2PCh. 4 - Prob. 4.8.1PCh. 4 - Prob. 4.8.2PCh. 4 - OnJanuary 1, 2015, Peanut Company acquired 80% of...Ch. 4 - Prob. 4.11PCh. 4 - Prob. 4.13.1PCh. 4 - Prob. 4.13.2PCh. 4 - Prob. 4.14.1PCh. 4 - Prob. 4.14.2PCh. 4 - Prob. 4A.1APCh. 4 - Prob. 4A.2APCh. 4 - Prob. 4.1.1C
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