Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Please help! On January 1, 2017, a subsidiary sold equipment to its parent for $520,000. The subsidiary's original cost was $200,000 and as of January

Please help!

image text in transcribedimage text in transcribedimage text in transcribed

On January 1, 2017, a subsidiary sold equipment to its parent for $520,000. The subsidiary's original cost was $200,000 and as of January 1, 2017, $20,000 in depreciation had been recorded on the subsidiary's books. At the date of sale, the equipment had a 10-year remaining life, straight-line. It is now December 31, 2021 (5 years since the sale), and the parent still holds the equipment. In the consolidation eliminating entries for 2021, the accumulated depreciation account is reduced by a net amount of O A. $130,000 O B. $160,000 O C. $170,000 O D. $150,000 A subsidiary sells merchandise to its parent at a markup of 25% on cost. In the current year, the parent had $75,000 in merchandise purchased from the subsidiary in its beginning inventory. During the current year, the parent paid $750,000 for merchandise from the subsidiary. By year-end, the parent has sold $700,000 of merchandise purchased from the subsidiary to outside customers for $900,000. What is consolidated sales revenue for the year? O A. $1,650,000 O B. $1,500,000 O C. $ 750,000 OD. $ 900,000 A U.S. company acquired a Turkish subsidiary at the beginning of the current year. The subsidiary's trial balances for January 1 and December 31 are presented below, in Turkish lira. January 1 December 31 Dr (Cr) Dr (Cr) Cash, receivables $ 40,000 20,000 Plant & equipment, net 400,000 435,000 Liabilities (175,000) (170,000) Capital stock (115,000) (115,000) Retained earnings, January 1 (150,000) (150,000) Dividends 15,000 Sales revenue (800,000) Operating expenses 765,000 Total t 0 + 0 New plant & equipment of 100,000 was acquired during the year. Operating expenses include t65,000 of depreciation on plant & equipment, of which $10,000 is related to plant & equipment purchased during the year. Exchange rates (U.S.$/) are as follows: January 1 $0.24 Average for year 0.25 Plant & equipment acquired 0.26 Dividends declared 0.27 December 31 0.30 Assume that the subsidiary's functional currency is the U.S. dollar. What are remeasured operating expenses for the subsidiary for the year? O A. $191,250 O B. $191,900 O C. $190,800 O D. $229,500

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Accounting

Authors: Carl S. Warren, James M. Reeve, Philip E. Fess

19th Edition

0538869720, 978-0538869720

More Books

Students also viewed these Accounting questions

Question

What is intermodulation noise?

Answered: 1 week ago