4 points Save Answer Gold Company acquired 75% of Silver Company on January 1, 2020. On December 31, 2020 Silver has common stock of $250,000 and retained earnings of $600,000. Intra-entity transfer of inventory during the years 2020 and 2021 include transfer price of $160,000 and $200,000, and cost of $120,000 and $140,000 respectively. Ending inventory was $32,000 in 2020 and $40,000 in 2021. Gold uses the equity method of accounting. Khalid was required to prepare consolidation entries '*G' and 'S' for the year 2021 under (i) a downstream transfer and (ii) an upstream transfer. He prepared the following entry ONLY: 'S' Upstream transfer: Common stock-Subsidiary 250,000 Retained Earnings-Subsidiary, 1/1/21 592,000 Investment in Subs .631,500 Noncontrolling Interest-1/1/21 210,500 Required: 1. Prepare consolidation entry *G that should have been prepared before consolidation entry 'S' for the year 2021. 2. Prepare consolidation entries '*G' and 'S' when the transfer is downstream. For the toolbar, press ALT+F10 (PC) or ALT-FN+F10 (Mac). 4 points Save Answer Gold Company acquired 75% of Silver Company on January 1, 2020. On December 31, 2020 Silver has common stock of $250,000 and retained earnings of $600,000. Intra-entity transfer of inventory during the years 2020 and 2021 include transfer price of $160,000 and $200,000, and cost of $120,000 and $140,000 respectively. Ending inventory was $32,000 in 2020 and $40,000 in 2021. Gold uses the equity method of accounting. Khalid was required to prepare consolidation entries '*G' and 'S' for the year 2021 under (i) a downstream transfer and (ii) an upstream transfer. He prepared the following entry ONLY: 'S' Upstream transfer: Common stock-Subsidiary 250,000 Retained Earnings-Subsidiary, 1/1/21 592,000 Investment in Subs .631,500 Noncontrolling Interest-1/1/21 210,500 Required: 1. Prepare consolidation entry *G that should have been prepared before consolidation entry 'S' for the year 2021. 2. Prepare consolidation entries '*G' and 'S' when the transfer is downstream. For the toolbar, press ALT+F10 (PC) or ALT-FN+F10 (Mac)