The Year 5 gain on sale of assets resulted from the subsidiary selling equipment to the...
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The Year 5 gain on sale of assets resulted from the subsidiary selling equipment to the parent on September 30. The parent immediately leased the equipment back to the subsidiary at an annual rental of $15,600. This was the only intercompany rent transaction that occurred each year. The equipment had a remaining life of five years on the date of the intercompany sale The Year 6 gain on sale of assets resulted from the January 1 sale of a building, with a remaining life of seven years, by the subsidiary to the parent. Both gains were taxed at a rate of 40%. CONSOLIDATED INCOME STATEMENTS Miscellaneous revenues Gain on sale of assets Rental revenue Miscellaneous expenses Rental expense Depreciation expense Income tax expense Non-controlling interest Net income Year 5 $ 765,000 10,400 3,900 Year 6 $840,000 44,100 15,600 779,300 899,700 402,200 492,940 54,800 65,200 78,000 82,800 82,500 96,000 34,000 5,520 651,500 742,460 $127,800 $ 157,240 Required: Prepare correct consolidated income statements for Years 5 and 6. (Input all values as positive numbers. Leave no cells blank-be certain to enter zero wherever required. Omit $ sign in your response.) Parent Company Corrected Consolidated Income Statements Years 5 and 6. Miscellaneous revenues Miscellaneous expense Rent expense Depreciation expense Income tax expense: Consolidated net income Attributable to: Year 5 $ $ Shareholders of Parent $ NCI $ Year 6 The Year 5 gain on sale of assets resulted from the subsidiary selling equipment to the parent on September 30. The parent immediately leased the equipment back to the subsidiary at an annual rental of $15,600. This was the only intercompany rent transaction that occurred each year. The equipment had a remaining life of five years on the date of the intercompany sale The Year 6 gain on sale of assets resulted from the January 1 sale of a building, with a remaining life of seven years, by the subsidiary to the parent. Both gains were taxed at a rate of 40%. CONSOLIDATED INCOME STATEMENTS Miscellaneous revenues Gain on sale of assets Rental revenue Miscellaneous expenses Rental expense Depreciation expense Income tax expense Non-controlling interest Net income Year 5 $ 765,000 10,400 3,900 Year 6 $840,000 44,100 15,600 779,300 899,700 402,200 492,940 54,800 65,200 78,000 82,800 82,500 96,000 34,000 5,520 651,500 742,460 $127,800 $ 157,240 Required: Prepare correct consolidated income statements for Years 5 and 6. (Input all values as positive numbers. Leave no cells blank-be certain to enter zero wherever required. Omit $ sign in your response.) Parent Company Corrected Consolidated Income Statements Years 5 and 6. Miscellaneous revenues Miscellaneous expense Rent expense Depreciation expense Income tax expense: Consolidated net income Attributable to: Year 5 $ $ Shareholders of Parent $ NCI $ Year 6
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the corrected consolidated income statements for Years 5 and 6 Year 5 Consolidated Income Statement ... View the full answer
Related Book For
Modern Advanced Accounting In Canada
ISBN: 9781259066481
7th Edition
Authors: Hilton Murray, Herauf Darrell
Posted Date:
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