Peat Company owns a 90% interest in Seaton Company. The consolidated income statement drafted by the controller of Peat Company appeared as follows:

Peat Company and SubsidiaryConsolidated Income Statementfor Year Ended December 31, 2015
Sales				$14,056,700
Cost of Sales		9,280,200
Operating Expense		1,783,100		11,063,300
Consolidated Income				2,993,400
Less Noncontrolling Interest in Consolidated Income				199,340
Controlling Interest in Consolidated Net Income				$2,794,060

During your audit you discover that intercompany sales transactions were not reflected in the controller?s draft of the consolidated income statement. Information relating to intercompany sales and unrealized intercompany profit is as follows:

		Cost		SellingPrice		Unsold atYear-End
2014 Sales?Seaton to Peat		$1,487,100		$1,789,800		1/3
2015 Sales?Peat to Seaton		899,000		1,390,600		2/5

Prepare a corrected consolidated income statement for Peat Company and Seaton Company for the year ended December 31, 2015.

Prepare a corrected consolidated income statement for Peat Company and Seaton Company for the year ended December 31, 2015.

The Options are : Consolidated Income, Controlling Interest in Consolidated Net Income,Cost of Goods Sold, Noncontrolling Interest in Consolidated Income, Operating Expense, Sales?

Transcribed Image Text:

Prepare a corrected consolidated income statement for Peat Company and Seaton Company for the year ended December 31, 2015. PEAT COMPANY AND SUBSIDIARY Consolidated Income Statement For the Year Ended December 31, 2015 Prepare a corrected consolidated income statement for Peat Company and Seaton Company for the year ended December 31, 2015. PEAT COMPANY AND SUBSIDIARY Consolidated Income Statement For the Year Ended December 31, 2015

Answer rating: 100% (QA)

A 1 Calculation of cost of goods sold 2 Reported cost of go... View the full answer