On January 2012, The parent company owned 90% of the subsidiary company when subsidiaries' book and fair values were equal. for the year ended 31/12/2019, the parent income statement shows sales revenue of 500,000 $, cost of sales 300,000 $, operating expenses of 100,000$, and income from subsidiary 40,000$. The subsidiary income statement for 2019 shows sales revenue 300,000$, cost of sales 150,000$ operating expenses of 100,000$.

During 2018 the parent company sold inventory that cost $120,000 to the subsidiary for 180,000. 50% of the inventory remained in the subsidiary’s ending inventory for 2018. During 2019, the parent also sold inventory that cost 150,000 to the subsidiary for 225,000. (1/3) of this inventory remained in the subsidiary’s ending inventory for 2019.

A) The amount of the consolidated sales revenue for 2019 will be?

B) The consolidated amount of cost of sales for 2019 will be?

Answer rating: 100% (QA)

2019 Adjustment 1 Adjustment 2 Net Adjusted Value Parent ... View the full answer