advance accounting task, 6th grade, due to 7 july


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advance accounting task, 6th grade, due to 7 july Document Preview: What is the objective of eliminating the effects of intercompany sales of plant assets in preparing consolidated financial statements? In accounting for unrealized profits and losses from intercompany sales of plant assets, does it make any difference if the parent is the purchaser or the seller? Would your answer be different if the subsidiary were 100 percent owned? When are unrealized gains and losses from intercompany sales of land realized from the viewpoint of the selling affiliate? How is the computation of noncontrolling interest share affected by downstream sales of land? By upstream sales of land? Consolidation workpaper entries are made to eliminate 100 percent of the unrealized profit from the land account in downstream sales of land. Is 100 percent also eliminated for upstream sales of land? How are unrealized gains and losses from intercompany transactions involving depreciable assets eventually realized? Describe the computation of noncontrolling interest share in the year of an upstream sale of depreciable plant assets. How does a parent eliminate the effects of unrealized gains on intercompany sales of plant assets under the equity method? What is the effect of intercompany sales of plant assets on parent and consolidated net income in years subsequent to the year of sale? Explain the sequence of workpaper adjustments and eliminations for unrealized gains and losses on depreciable plant assets. Is your answer affected by whether the intercompany transaction occurred in the current year or in prior years? E 6-1 General Questions Use the following information in answering questions 1 and 2: Par Company sells land with a book value of $5,000 to Sub Company for $6,000 in 2011. Sub Company holds the land during 2012. Sub Company sells the land for $8,000 to an outside entity in 2013. In 2011 the unrealized gain: a To be eliminated is affected by the non controlling interest percentage b Is initially included in the subsidiary‚Äôs… Attachments: homework.docx homework.docx

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