Exam 5: A: Consolidated Financial Statements Intra-Entity Asset Transactions

Norek Corp.owned 70% of the voting common stock of Thelma Co.On January 2, 2017, Thelma sold a parcel of land to Norek.The land had a book value of $32,000 and was sold to Norek for $45,000.Thelma's reported net income for 2017 was $119,000.Assuming there are no excess amortizations associated with the consolidation, and no other intra-entity asset transfers, what is net income attributable to the noncontrolling interest?

In the consolidation worksheet for 2017, which of the following accounts would be debited to eliminate unrecognized intra-entity gross profit with regard to the 2017 intra-entity transfers?

Why do intra-entity transfers between the component companies of a business combination occur so frequently?

What is the impact on the noncontrolling interest of a subsidiary when there are downstream transfers of inventory between the parent and subsidiary companies?

For consolidation purposes, what amount would be debited to cost of goods sold for the 2017 consolidation worksheet with regard to unrecognized intra-entity gross profit remaining in ending inventory with respect to the transfer of merchandise?

What is the gain or loss on equipment recognized by Devin on its internal accounting records for 2017?

What is the consolidated gain or loss on equipment for 2017?

Assuming there are no excess amortizations associated with the consolidation, and no other intra-entity asset transfers, what amount of this gain should be recognized for consolidation purposes for 2017?

How would consolidated cost of goods sold have differed if the inventory transfers had been for the same amount and cost, but from Stendall to Edgar?

What amount should be recorded on Wilson's books as gain on the transfer of equipment, prior to preparing consolidating entries?

Compute consolidated cost of goods sold.

Assuming there are no excess amortizations associated with the consolidation, and no other intra-entity asset transfers, compute Wilson's share of income from Simon for consolidation for 2017.

Prepare the consolidation entries that should be made at the end of 2017.

Included in the amounts for Pot's sales were Pot's sales of merchandise to Skillet for $140,000.There were no intra-entity transfers from Skillet to Pot.Intra-entity transfers had the same markup as sales to outsiders.Skillet still held 40% of the intra-entity gross profit remaining in ending inventory at the end of 2018.What are consolidated sales and cost of goods sold, respectively for 2018?

Assuming there are no excess amortizations or other intra-entity transactions, Compute the income from Devin reported on Pepe's books for 2017.

For consolidation purposes, what amount would be debited to cost of goods sold for the 2018 consolidation worksheet with regard to the unrecognized intra-entity gross profit remaining in ending inventory with respect to the 2018 transfer of merchandise?

Compute consolidated sales.

What is the total of consolidated operating expenses?

What is the consolidated total of noncontrolling interest appearing in the balance sheet?

Assuming there are no excess amortizations or other intra-entity transactions, compute income from Stark reported on Parker's books for 2019.