Selected Information from the Separate and Consolidated Balance Sheets and Income

Essay

Selected information from the separate and consolidated balance sheets and income statements of Palo Alto, Inc.and its subsidiary, Stanford Co., as of December 31, 2016, and for the year then ended is as follows:
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$\begin{array}{lrrr}&\text { Palo Alto }&\text {Stanford }&\text {Consolidated }\\\text { Balance sheet accounts: } & & & \\ \text { Accounts receivable } & \$ 26,000 & \$ 19,000 & \$ 42,000 \\\text { Inventory } & 30,000 & 25,000 & 50,000 \\\text { Investment in Stanford } & 67,000 & - & - \\\text { Stockholders' equity } & 154,000 & 50,000 & 154,000\\\\\text { Income statement accounts: }\\\text { Revenues } & \$ 200,000 & \$ 140,000 & \$ 300,000 \\\text { Cost of goods sold } & 150,000 & 110,000 & 225,000 \\\quad \text { Gross profit } & 50,000 & 30,000 & 75,000 \\& & & \\\text { Equity in earnings of Stanford } & \$ 9,000 & -- & -- \\\quad \text { Net income } & \$ 36,000 & \$ 20,000 & \$ 36,000\end{array}$
Additional information:
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During 2016, Palo Alto sold goods to Stanford at the same markup on cost that Palo Alto uses for all sales.At December 31, 2016, Stanford had not paid for all of these goods and still held 50% of them in inventory.
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Palo Alto acquired its interest in Stanford five years earlier (as of December 31, 2016).
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Required:
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For each of the following items, calculate the required amount.
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a.The amount of intercompany sales from Palo Alto to Stanford during 2016.?
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b.The amount of Stanford's payable to Palo Alto for intercompany sales as of December 31, 2016.?
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c.In Palo Alto's December 31, 2016, consolidated balance sheet, the carrying amount of the inventory that Stanford purchased from Palo Alto.?