Answered step by step
Verified Expert Solution
Question
00
1 Approved Answer
QUESTION 3 10 points Save On January 1, 20x1, Parley Company acquired 75% of the common shares of Saute Limited. On this date, the book
QUESTION 3 10 points Save On January 1, 20x1, Parley Company acquired 75% of the common shares of Saute Limited. On this date, the book values of Saute's assets and liabilities were equal to their fair values except for the following: Equipment: book value exceeded fair value by $10000. The equipment had a remaining useful life of 5 years, Bonds payable: fair value exceeded book value by $44000. The bonds had 4 years remaining to maturity. On July 1, 20x2. Parley sold equipment to Saute at a gain of $45000. The equipment had a remaining useful life of 6 years on the date of the Intercompany sale. On January 1, 20x3, Parley's inventory included a profit of $20000 on goods purchased from Saute in the previous year. During 20x3. Sauto sold inventory to Parley for $136000 at a profit of $60000. Parley sold 50% of this inventory to third parties by the end of the 20x3 year On January 1, 25x3, Parley loaned $120000 at 8% p.a. to Saute. The following are select balances for the two companies at December 31, 20x3. Sales Cost of goods sold Depreciation expense Interest expense Dividends paid Parley $732000 $388000 $71000 Saute $749000 $442000 $92000 $57000 $99000 $55000 560000 Required: Calculate the amounts to be reported for the following and note it in the blanks below: a. Consolidated Sales b. Consolidated COGS $ c. Consolidated depreciation expense $ d. Consolidated interest expense $ e. Consolidated dividends $
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access with AI-Powered Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started