Consolidated Income Statement Data
Master Products acquired 80 percent ownership of LoCal Bakeries on January 1, 20X3, when the fair value of LoCal’s depreciable assets was equal to book value.
| Master Products |
| LoCal Bakeries |
|
Sales |
| $ 3,00,000 |
| $ 2,00,000 |
Cost of Goods Sold | $ 2,00,000 |
| $ 1,30,000 |
|
Depreciation Expense | 40,000 | (2,40,000) | 30,000 | (1,60,000) |
Income before Income from Subsidiary |
| $ 60,000 |
|
|
Net Income |
|
|
| $ 40,000 |
During 20X3, Master Products purchased a special imported yeast for $35,000 and resold it to LoCal for $50,000. LoCal did not resell any of the yeast before year-end.
Required
Determine the amounts to be reported for each of the following items in the consolidated income statement for 20X3:
a. Sales.
b. Investment income from LoCal Bakeries.
c. Cost of goods sold.
d. Depreciation expense.
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