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Chapter 5: Problem 20

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by

Jade Krause

on 6 November 2014

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Transcript of Chapter 5: Problem 20


01/01/14: Acquired 80% of Seacraft Company for $612,000.
Seacraft's identifiable assets and liabilities, net fair value $765,000: $153,000 to 20% NCI.
December 31, 2015
Problem A
You sold Seacraft inventory at a markup of 60 % of cost. Intra-entity transfers were $114,000 in 2014 and $134,000 in 2015. Of this inventory, Seacraft retained and then sold $52,000 of the 2014 transfers in 2015 and held $66,000 of the 2015 transfers until 2016.
Determining GP
Determining GP
Problem C
You sold Seacraft a building on January 1, 2014, for $128,000, although the book value was only $74,000. The building had a 5-year remaining life and was to be depreciated using the straight-line method with no salvage value.
Determining Depreciation
Protrade Corporation
Background
Cost of Goods Sold
Inventory
Problem B
Seacraft sold you inventory at a markup of 60% of cost. Intra-entity transfers were $74,000 in 2014 and $104,000 in 2015. Of this inventory, $45,000 of the 2014 transfers were retained and then sold by you in 2015, whereas $59,000 of the 2015 transfers were held until 2016.
Questions?
Cost of Goods Sold
Inventory
Buildings (Net)
Operating Expenses
Net Income to NCI
Net Income to NCI
Net Income to NCI
Full transcript