Prepare in general journal form work paper entries necessary

Reference no: EM131959280

Problem

Pine Company, a computer manufacturer, owns 90% of the outstanding stock of Slider Company. On January 1, 2017, Pine sold computers to Slider for $500,000. The computers, which are inventory to Pine, had a cost to Pine of $350,000. Slider Company estimated that the computers had a useful life of six years from the date of purchase.

Slider Company reported net income of $310,000, and Pine Company reported net income of $870,000 from its independent operations (including sales to affiliates) for the year ended December 31, 2017.

Required:

2018: Prepare in general journal form the work paper entries necessary because of the intercompany sales in the consolidated statements workpaper for both 2017 and 2018.

2017: Calculate controlling interest in consolidated net income for 2017.

Reference no: EM131959280

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