Question
Pearlwater Corporation owns 100% of its subsidiary, Snapall Corporation. Intercompany sales for 2019 and related inventory balances are as follows: Pearlwater Snapall Beginning inventory acquired
- Pearlwater Corporation owns 100% of its subsidiary, Snapall Corporation. Intercompany sales for 2019 and related inventory balances are as follows:
|
| Pearlwater | Snapall |
| Beginning inventory acquired from affiliate, reported on buyers books | $ 30,000 | $ 18,000 |
| Ending inventory acquired from affiliate, reported on buyers books | 27,600 | 19,200 |
| Intercompany sales to affiliate | 500,000 | 400,000 |
Pearlwater sells merchandise to Snapall at a markup of 20% on cost. Snapall sells merchandise to Pearlwater at a markup of 25% on cost.
Required
Prepare the eliminating entries required to consolidate the trial balances of Pearlwater and Snapall.
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Cost Accounting For Managerial Planning Decision Making And Control
Authors: Andrew Schiff, Hsihui Chang, Woody M Liao, James L Boockholdt
5th Edition
0759340412, 978-0759340411
