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4. Big Co owns 94% of Little Co stock In 2022, Little sold merchandise to Big for $75649 The merchandise had cost Little $38370 During
4. Big Co owns 94% of Little Co stock In 2022, Little sold merchandise to Big for $75649 The merchandise had cost Little $38370 During 2022 65% of the goods were resold to third parties. The remainder were resold in 2023 Required: a. What is the dollar amount of gross profit that is unrealized at the end of 2022? b. Assuming Big uses the "fully adjusted equity method", provide the equity method entry needed to defer the unrealized profit in 2022. c. Provide the consolidation entry necessary in 2022 arising from this intercompany transaction. d. Provide the consolidation entry necessary in 2023 arising from the final sale of the remaining goods. Big's percentage ownership of common Cost of goods sold Sales price of goods Percentage resold in 2022 94 38370 75649 65 4. Big Co owns 94% of Little Co stock In 2022, Little sold merchandise to Big for $75649 The merchandise had cost Little $38370 During 2022 65% of the goods were resold to third parties. The remainder were resold in 2023 Required: a. What is the dollar amount of gross profit that is unrealized at the end of 2022? b. Assuming Big uses the "fully adjusted equity method", provide the equity method entry needed to defer the unrealized profit in 2022. c. Provide the consolidation entry necessary in 2022 arising from this intercompany transaction. d. Provide the consolidation entry necessary in 2023 arising from the final sale of the remaining goods. Big's percentage ownership of common Cost of goods sold Sales price of goods Percentage resold in 2022 94 38370 75649 65
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