Business, 01.07.2021 20:20 enitramedouard12

Phone Corporation owns 80 percent of Smart Company's stock. At the end of 20X8, Phone and Smart reported the following partial operating results and inventory balances: Phone Corporation Smart Company
Total sales $735,000 $531,000
Sales to Smart Company 144,200
Sales to Phone Corporation 244,200
Net income 30,000
Operating income (excluding
investment income from Smart) 80,000
Inventory on hand, December 31, 20X8, purchased from:
Smart Company 48,840
Phone Corporation 43,260
Phone regularly prices its products at cost plus a 40 percent markup for profit. Smart prices its sales at cost plus a 20 percent markup. The total sales reported by Phone and Smart include both intercompany sales and sales to non-affiliates.
Required:
a. What amount of sales will be reported in the consolidated income statement for 20X8?
b. What amount of cost of goods sold will be reported in the 20x8 consolidated income statement?
c. What amount of consolidated net income and income to controlling interest will be reported in the 20x8 consolidated income statement?
d. What balance will be reported for inventory in the consolidated balance sheet for December 31, 20x8?

Answers: 2

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Phone Corporation owns 80 percent of Smart Company's stock. At the end of 20X8, Phone and Smart repo...

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