QUESTION 3 Not complete Marked out of 276.00 P Flag question Consolidation subsequent to date of acquisition-upstream intercompany inventory sale- Equity method with noncontrolling interest, AAP, and upstream intercompany inventory sale Assume that, on January 1, 2007, a parent company acquired an 80% interest in its subsidiary. The total fair value of the controlling and noncontrolling interests was $550,000 over the book value of the subsidiary's Stockholders' Equity on the acquisition date. the parent assigned the excess to the following [A] assets: Initial Useful A1 Asset Fair Value Life (years) Patent $300,000 10 250,000 Indefinite $550,000 80% of the Goodwill is allocated to the parent. Assume that the subsidiary sells inventory to the parent (upstream) which includes that inventory in products that it ultimately sells to customers outside of the controlled group. You have compiled the following data as of 2012 and 2013: 2012 2013 Transfer price for inventory sale $673,000 $733,000 (615,000) (653,000) $58,000 $80,000 35% $14,500 $28,000 $92,000 $95,000 Cost of goods sold Gross profit % inventory remaining Gross profit deferred 2596 QUESTION 3 Not complete Marked out of 276.00 P Flag question Consolidation subsequent to date of acquisition-upstream intercompany inventory sale- Equity method with noncontrolling interest, AAP, and upstream intercompany inventory sale Assume that, on January 1, 2007, a parent company acquired an 80% interest in its subsidiary. The total fair value of the controlling and noncontrolling interests was $550,000 over the book value of the subsidiary's Stockholders' Equity on the acquisition date. the parent assigned the excess to the following [A] assets: Initial Useful A1 Asset Fair Value Life (years) Patent $300,000 10 250,000 Indefinite $550,000 80% of the Goodwill is allocated to the parent. Assume that the subsidiary sells inventory to the parent (upstream) which includes that inventory in products that it ultimately sells to customers outside of the controlled group. You have compiled the following data as of 2012 and 2013: 2012 2013 Transfer price for inventory sale $673,000 $733,000 (615,000) (653,000) $58,000 $80,000 35% $14,500 $28,000 $92,000 $95,000 Cost of goods sold Gross profit % inventory remaining Gross profit deferred 2596