12. P Company regularly sells merchandise to its 80%-owned subsidiary, S Corporation. In 2024, P sold...

Transcribed Image Text:

12. P Company regularly sells merchandise to its 80%-owned subsidiary, S Corporation. In 2024, P sold merchandise that cost $240,000 to S for $300,000. Half of this merchandise remained in S's December 31, 2024 inventory. During 2025, P sold merchandise that cost $375,000 to S for $468,000. Forty percent of this merchandise inventory remained in S's December 31, 2025 inventory. Selected income statement information for the two affiliates for the year 2025 is as follows: P S Sales Revenue $2,250,000 $1,125,000 Cost of Goods Sold 1,800,000 937,500 Gross profit $450,000 $187,500 Consolidated cost of goods sold for P Company and Subsidiary for 2025 are: 12. P Company regularly sells merchandise to its 80%-owned subsidiary, S Corporation. In 2024, P sold merchandise that cost $240,000 to S for $300,000. Half of this merchandise remained in S's December 31, 2024 inventory. During 2025, P sold merchandise that cost $375,000 to S for $468,000. Forty percent of this merchandise inventory remained in S's December 31, 2025 inventory. Selected income statement information for the two affiliates for the year 2025 is as follows: P S Sales Revenue $2,250,000 $1,125,000 Cost of Goods Sold 1,800,000 937,500 Gross profit $450,000 $187,500 Consolidated cost of goods sold for P Company and Subsidiary for 2025 are:

Answer rating: 100% (QA)

To determine the consolidated cost of goods sold for P Company and its subsidiary for 2... View the full answer