Assignment Parent Company owns 80 percent of Sub Company's voting shares. During 20X5, Parent produced 30,000 computer desks at a cost of $50 each and sold 10,000 desks to Sub for $60 each. Sub sold 6,000 of the desks to unaffiliated companies for $75 each prior to December 31, 20x5, and sold the remainder in early 20x6 for $75 each. Both companies use perpetual inventory systems. Required a. What amounts of cost of goods sold did Parent and Sub record in 20X5? b. What amount of cost of goods sold must be reported in the consolidated income statement for 20X5? c. Give the worksheet eliminating entry or entries needed in preparing consolidated financial statements at December 31, 20X5, relating to the intercorporate sale of inventory. d. Give the worksheet eliminating entry or entries needed in preparing consolidated financial statements at December 31, 20X6, relating to the intercorporate sale of inventory. e. Give the worksheet eliminating entry or entries needed in preparing consolidated financial statements at December 31, 20X6, relating to the intercorporate sale of inventory if Sub had produced the computer desks at a cost of $50 each and sold 10,000 desks to Parent for $60 each in 20X5, with Parent selling 6,000 desks to unaffiliated companies in 20x5 and the remaining 4,000 in 20X6. Assignment Parent Company owns 80 percent of Sub Company's voting shares. During 20X5, Parent produced 30,000 computer desks at a cost of $50 each and sold 10,000 desks to Sub for $60 each. Sub sold 6,000 of the desks to unaffiliated companies for $75 each prior to December 31, 20x5, and sold the remainder in early 20x6 for $75 each. Both companies use perpetual inventory systems. Required a. What amounts of cost of goods sold did Parent and Sub record in 20X5? b. What amount of cost of goods sold must be reported in the consolidated income statement for 20X5? c. Give the worksheet eliminating entry or entries needed in preparing consolidated financial statements at December 31, 20X5, relating to the intercorporate sale of inventory. d. Give the worksheet eliminating entry or entries needed in preparing consolidated financial statements at December 31, 20X6, relating to the intercorporate sale of inventory. e. Give the worksheet eliminating entry or entries needed in preparing consolidated financial statements at December 31, 20X6, relating to the intercorporate sale of inventory if Sub had produced the computer desks at a cost of $50 each and sold 10,000 desks to Parent for $60 each in 20X5, with Parent selling 6,000 desks to unaffiliated companies in 20x5 and the remaining 4,000 in 20X6
