Question
Presented are the separate-entity and consolidated balances for Delicate Delights Corporation (DDC) and its subsidiary, Simple Delicious Inc. (SDI) for the year-ending December 31, 2022.
Presented are the separate-entity and consolidated balances for Delicate Delights Corporation (DDC) and its subsidiary, Simple Delicious Inc. (SDI) for the year-ending December 31, 2022.
DDC purchased its shares in SDI four years ago. At the time of purchase, this goodwill calculation was done:
Required
a) Determine the value of intercompany inventory sales that occurred during 2022.
b) What amount of unrealized profit existed at the end of 2022?
c) Determine the amount of unrealized inventory profit at the beginning of 2022.
d) Assuming no other intercompany revenues and expenses, determine the amount of dividends declared by SDI in 2022.
e) Determine the intercompany amount owing at the end of 2022.
Calculation of goodwill at acquisition 100% Purchase price $8,405,428 Less the carrying value ofStep by Step Solution
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