Planet Corporation acquired 90 percent of Saturn Company's voting shares of stock in 20X1. During 20X4,...

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Planet Corporation acquired 90 percent of Saturn Company's voting shares of stock in 20X1. During 20X4, Planet purchased 40,000 Playday doghouses for $24 each and sold 25,000 of them to Saturn for $30 each. Saturn sold all of the doghouses to retail establishments prior to December 31, 20X4, for $45 each. Both companies use perpetual inventory systems. Required: a. Prepare the journal entries Planet recorded for the purchase of inventory and resale to Saturn Company in 20X4. Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Answer is complete and correct. General Journal Debit Credit 960,000 960,000 No Event A 1 Inventory Cash (Accounts payable) B 2 Cash (Accounts receivable) Sales C 3 Cost of goods sold Inventory 750,000 750,000 600,000 600,000 b. Prepare the journal entries Saturn recorded for the purchase of inventory and resale to retail establishments in 20X4. Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field. > Answer is complete but not entirely correct. General Journal No Event A 1 Inventory Cash (Accounts payable) B 2 C 3 Cash (Accounts receivable) Sales Cost of goods sold Inventory Debit 750,000 Credit 750,000 810,000 810,000 540,000 540,000 x c. Prepare the worksheet consolidation entry(ies) needed in preparing consolidated financial statements for 20X4 to remove all effects of the intercompany sale. Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field. No Entry A 1 Sales Cost of goods sold Answer is complete and correct. Accounts Debit Credit 750,000 750,000 Planet Corporation acquired 90 percent of Saturn Company's voting shares of stock in 20X1. During 20X4, Planet purchased 40,000 Playday doghouses for $24 each and sold 25,000 of them to Saturn for $30 each. Saturn sold all of the doghouses to retail establishments prior to December 31, 20X4, for $45 each. Both companies use perpetual inventory systems. Required: a. Prepare the journal entries Planet recorded for the purchase of inventory and resale to Saturn Company in 20X4. Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Answer is complete and correct. General Journal Debit Credit 960,000 960,000 No Event A 1 Inventory Cash (Accounts payable) B 2 Cash (Accounts receivable) Sales C 3 Cost of goods sold Inventory 750,000 750,000 600,000 600,000 b. Prepare the journal entries Saturn recorded for the purchase of inventory and resale to retail establishments in 20X4. Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field. > Answer is complete but not entirely correct. General Journal No Event A 1 Inventory Cash (Accounts payable) B 2 C 3 Cash (Accounts receivable) Sales Cost of goods sold Inventory Debit 750,000 Credit 750,000 810,000 810,000 540,000 540,000 x c. Prepare the worksheet consolidation entry(ies) needed in preparing consolidated financial statements for 20X4 to remove all effects of the intercompany sale. Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field. No Entry A 1 Sales Cost of goods sold Answer is complete and correct. Accounts Debit Credit 750,000 750,000