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Cayman Inc. bought 30% of Maya Company on January 1, 2018 for $450,000. The equity method of accounting was used. The book value and fair
Cayman Inc. bought 30% of Maya Company on January 1, 2018 for $450,000. The equity method of accounting was used. The book value and fair value of the net assets of Maya on that date were $1,500,000. Maya began supplying inventory to Cayman as follows: Amount Held by Cayman at Year-End Cost to Maya Transfer Price 2018 2019 30,000$ 48,000 S 45,000 80,000 $9,000 20,000 Maya reported net income of $100,000 in 2018 and $120,000 in 2019 while paying $40,000 in dividends each year. 7) What is the investor's share of gross profit on intra-entity inventory sales that should be deferred on December 31,2018? I A) S4,500. B) $900 C) S9,000. D) $3,000 E) S6,000
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