Prepare income distribution schedules for peninsula

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Reference no: EM13950531

Merchandise and ?xed asset sale. Peninsula Company owns an 80% controlling interest in the Sandbar Company. Sandbar regularly sells merchandise to Peninsula, which then sold to outside parties. The gross pro?t on all such sales is 40%. On January 1, 20X1, Peninsula sold land and a building to Sandbar. Tax assessments divide the value of the parcel 20% to land and 80% to structures. Pertinent information for the companies is summarized:

	Peninsula	Sandbar
Internally generated net income, 20X1 .	$520,000	$250,000
Internally generated net income, 20X2 .	340,000	235,000
Intercompany merchandise sales, 20X1		100,000
Intercompany merchandise sales, 20X2		120,000
Intercompany inventory, December 31, 20X1 .		15,000
Intercompany inventory, December 31, 20X2 .		20,000
Cost of real estate sold on January 1, 20X1 .	600,000
Sale price for real estate on January 1, 20X1	800,000
Depreciable life of building		20 years

Prepare income distribution schedules for 20X1 and 20X2 for Peninsula and Sandbar as they would be prepared to distribute income to the noncontrolling and controlling interests in support of consolidated worksheets.

Reference no: EM13950531

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