User Account

All Pages

What effect these intercompany transactions would have

Assignment Help Accounting Basics
Reference no: EM133056423

Question - During 2019, P Inc sold inventory to Q for $20,000. Half of this inventory remained in Q's warehouse at December 31, 2019 year end.

On January 1, 2019, Q Inc had inventory in its warehouse which was purchased from P for $5,000. This inventory was sold to an outside party during 2019.

Also during 2019, Q Inc sold inventory to P Inc. for $10,000. 50% of this inventory remained in P's warehouse at year end.

Both companies are subject to a tax rate of 25%. The gross profit percentage on sales is 30% for both companies.

P Inc. uses the cost method to account for its Investment in Q Inc. The inventories of both companies as at December 31, 2019 were all sold to outsiders during 2020. There were no intercompany transactions during 2020.

In your own words, explain what effect (if any) these intercompany transactions would have on the non-controlling interest.

Reference no: EM133056423

Questions Cloud

Determine the predetermined factory overhead rate : If factory overhead is to be applied based on direct labor hours, determine the predetermined factory overhead rate
Journalize the factory overhead incurred during April : During April, Cavy Company incurred factory overhead as follows: Utilities 460. Journalize the factory overhead incurred during April
Should BlackBoard accept the special order : The company will incur an additional salary for a supervisor of $15,500. Should BlackBoard accept the special order? Explain your decision
What was the cost of the company property : What was the cost of the company's property, plant, and equipment on January 31, 2021? What was the amount of accumulated depreciation
What effect these intercompany transactions would have : In your own words, explain what effect (if any) these intercompany transactions would have on the non-controlling interest
Difference between a simple and complex capital structure : Question - Describe the difference between a simple and complex capital structure. How do dilutive securities affect EPS computations
Determining the expected change in pretax profit : Currently your firm has an average collection period of 67 days and your have been asked to analyze offering a 1/10 net 30 discount to expedite collections.
Determining the npv if the opportunity cost of capital : Halcyon Lines is considering the purchase of a new bulk carrier for $7.0 million. The forecasted revenues are $6.6 million a year and operating costs are $5.6 m
Calculating the issue price of callable bond : QWE wishes to issue a perpetual callable bond that pays 7.7% annual coupon. The current interest rate is 7.7%. Next year, the interest rate will be 3.1% or 9.4%

Reviews

Write a Review

Accounting Basics Questions & Answers

  Record the two journal entries that should be recorded

Record the two journal entries that should be recorded by Wildhorse Company for the two purchases on January 1, 2020

  Calculate the factory overhead rate for the year

Using the single plantwide factory overhead rate based on direct labor hours, calculate the factory overhead rate for the year

  Prepare the journal entry for the purchase of the land

What is the difference between a promissory note payable and a mortgage note payable? Why would Silverman Corporation insist on obtaining a mortgage

  What do you mean by adjusting entries in accounting

What do you mean by Adjusting Entries in Accounting? Explain major types of adjusting entries. Moreover also elaborate for which accounts

  What are the three primary components of logistics

What are the three primary components of logistics?

  Explain the disadvantages of governmental involvement

You are now familiar with government and how it plays a role in our economy. Using what you learned in the lesson, describe two advantages and two Disadvantages

  A borrower is often confronted with a stated interest rate

a borrower is often confronted with a stated interest rate and an effective interest rate. what is the difference and

  The odle company makes and sells a single product called a

the odle company makes and sells a single product called a kitt. odle uses a standard costing system. each kitt has a

  Which would not be considered a contingent liability

An asset that cost $14,000 was sold for $9,000 cash. Accumulated depreciation on the asset was $7,000. The entry to record this transaction includes the recognition of, Which would NOT be considered a contingent liability?

  What amount did Sunland Company pay for Buffalo Ltds bonds

On January 1, 2021, Buffalo Ltd. issued bonds with a maturity value of $5.40 million for $5,175,360, What amount did Sunland Company pay for Buffalo Ltds bonds

  Problem related to early retirement from company

John Roberts is 55 years old and has been asked to accept early retirement from his company. The company has offered John three alternative compensation packages to induce John to retire:

  Scott company purchased equipment for 250000 on october 1

scott company purchased equipment for 250000 on october 1 2014. it is estimated that the equipment will have a useful

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

Submit Assignment

Academics

Major Subjects

Majors

Get In Touch

whatsapp: +1-415-670-9521

Phone: +1-415-670-9521

Email: [email protected]

TERMS & POLICIES

HELP & SUPPORT

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd