Compute equity method income from the Joint Venture for 2020. Turner and Clark Inc, both Canadian private

Compute equity method income from the Joint Venture for 2020.

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Turner and Clark Inc, both Canadian private companies, formed a joint venture on January 1, 2020 called Clar-Turn Inc. Turner and Clark each hold a 50% in the venture and share equally in any profits or losses arising from the venture. The following statements were prepared on December 31, 2020. Balance Sheets Current Assets Investment in Clar-Turn Fixed Assets Accumulated Depreciation Other Assets Total Assets Current Liabilities Long-Term Debt Common Shares Retained Earnings, Jan 1 Net Income for the year Liabilities and Equity Other Information: Turner $53,333 $26,667 $266,667 -$108,667 $86,667 $306,667 $45,333 $26,667 $120,000 $74,667 $40,000 $308,667 Clar-Turn $26,667 SO $108,667 -$13,333 $80,000 $200,000 $93,333 $40,000 $53,333 SO $13,333 $200,000 During 2020, Clar-Turn purchased $13,333 of inventory from Turner. Turner recorded a gross profit of $2,667 on these sales. On December 31, 2020, Clar-Turn's inventory contained half of the merchandise purchased from Turner. Turner initially recorded its Investment in Clar-Turn using the cost method. Turner plans to adjust its year-end statements to account for the Clar-Turn joint venture using the equity method. An income tax allocation rate of 20% applies. Turner and Clark Inc, both Canadian private companies, formed a joint venture on January 1, 2020 called Clar-Turn Inc. Turner and Clark each hold a 50% in the venture and share equally in any profits or losses arising from the venture. The following statements were prepared on December 31, 2020. Balance Sheets Current Assets Investment in Clar-Turn Fixed Assets Accumulated Depreciation Other Assets Total Assets Current Liabilities Long-Term Debt Common Shares Retained Earnings, Jan 1 Net Income for the year Liabilities and Equity Other Information: Turner $53,333 $26,667 $266,667 -$108,667 $86,667 $306,667 $45,333 $26,667 $120,000 $74,667 $40,000 $308,667 Clar-Turn $26,667 SO $108,667 -$13,333 $80,000 $200,000 $93,333 $40,000 $53,333 SO $13,333 $200,000 During 2020, Clar-Turn purchased $13,333 of inventory from Turner. Turner recorded a gross profit of $2,667 on these sales. On December 31, 2020, Clar-Turn's inventory contained half of the merchandise purchased from Turner. Turner initially recorded its Investment in Clar-Turn using the cost method. Turner plans to adjust its year-end statements to account for the Clar-Turn joint venture using the equity method. An income tax allocation rate of 20% applies.

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Turners Investment in Clar Turn 112020 26667 Sales to C... View the full answer