TIUITIU WUIHU Use the following information for the next two questions. Sunnyvale Company, a 90% owned subsidiary of Myrtlewood Company, sold land to Myrtlewood on March 6, 2016, for $80,000. The land originally cost Sunnyvale $120,000. Myrtlewood holds the land throughout the remainder of 2016 and all of 2017. 1. Write the elimination entry necessary for the 2016 consolidation worksheet related to this land sale. 2. Write the elimination entry needed for the 2017 consolidation worksheet entry related to the land sale. 3. Penguin owns 80% of Snow. On January 1, 2019, Penguins sells a building to Snow for $80,000. Penguin had purchased the building for $250,000 and had taken $150,000 of depreciation at the time of the sale to Snow. The building has a five-year remaining life and was to be depreciated straight-line with no salvage value. Prepare the necessary consolidation entries for 2019: 4. In question 3 above, what is the relationship between the ED amount and the original gain/loss? A) The ED amount is 1/5 of the gain/loss. B) The ED amount is double the gain/loss. C) The ED amount is one third of the gain/loss. D) The ED amount is one tenth of the gain/loss. 5. A subsidiary sells inventory to its parent at a markup of 30% on cost. In 2019, the parent paid $650,000 for merchandise received from the subsidiary. The parent sold $455,000 of the inventory to outside parties and the remaining $195,000 is stored in a warehouse in Wilmington, NC. Write the elimination entries needed for the 2019 consolidation worksheet for the intercompany inventory sales. TIUITIU WUIHU Use the following information for the next two questions. Sunnyvale Company, a 90% owned subsidiary of Myrtlewood Company, sold land to Myrtlewood on March 6, 2016, for $80,000. The land originally cost Sunnyvale $120,000. Myrtlewood holds the land throughout the remainder of 2016 and all of 2017. 1. Write the elimination entry necessary for the 2016 consolidation worksheet related to this land sale. 2. Write the elimination entry needed for the 2017 consolidation worksheet entry related to the land sale. 3. Penguin owns 80% of Snow. On January 1, 2019, Penguins sells a building to Snow for $80,000. Penguin had purchased the building for $250,000 and had taken $150,000 of depreciation at the time of the sale to Snow. The building has a five-year remaining life and was to be depreciated straight-line with no salvage value. Prepare the necessary consolidation entries for 2019: 4. In question 3 above, what is the relationship between the ED amount and the original gain/loss? A) The ED amount is 1/5 of the gain/loss. B) The ED amount is double the gain/loss. C) The ED amount is one third of the gain/loss. D) The ED amount is one tenth of the gain/loss. 5. A subsidiary sells inventory to its parent at a markup of 30% on cost. In 2019, the parent paid $650,000 for merchandise received from the subsidiary. The parent sold $455,000 of the inventory to outside parties and the remaining $195,000 is stored in a warehouse in Wilmington, NC. Write the elimination entries needed for the 2019 consolidation worksheet for the intercompany inventory sales
