Questions from Advanced Accounting

Q: 1. Pop, Inc., owns 80 percent of Son,

1. Pop, Inc., owns 80 percent of Son, Inc. During 2016, Pop sold goods with a 40 percent gross profit to Son. Son sold all of these goods in 2016. For 2016 consolidated financial statements, how shoul...

Q: Pam Corporation acquired an 85 percent interest in Sun Corporation on August

Pam Corporation acquired an 85 percent interest in Sun Corporation on August 1, 2016, for $522,750, equal to 85 percent of the underlying equity of Sun on that date. In August 2016, Sun sold inventory...

Q: 1. The separate incomes of Pop Corporation and Son Corporation,

1. The separate incomes of Pop Corporation and Son Corporation, a 100 percent–owned subsidiary of Pop, for 2017 are $2,000 and $1,000, respectively. Pop sells all of its output to So...

Q: Pop Corporation owns an 80 percent interest in Son Corporation and at

Pop Corporation owns an 80 percent interest in Son Corporation and at December 31, 2016, Pop’s investment in Son on an equity basis was equal to 80 percent of Son’s...

Q: Pam Corporation owns an 80 percent interest in Sun Corporation acquired several

Pam Corporation owns an 80 percent interest in Sun Corporation acquired several years ago. Sun regularly sells merchandise to Pam at 125 percent of Sun’s cost. Gross profit data of P...

Q: The consolidated income statement of Pop and Son for 2016 was as

The consolidated income statement of Pop and Son for 2016 was as follows (in thousands): Sales........................................................................................... $5,520 Cost o...

Q: What is a bargain purchase? Describe the accounting procedures necessary to

What is a bargain purchase? Describe the accounting procedures necessary to record and account for a bargain purchase.

Q: Son Corporation’s stockholders’ equity at December 31, 2015, consisted of

Son Corporation’s stockholders’ equity at December 31, 2015, consisted of the following (in thousands): Capital stock, $10 par, 60,000 shares issued and outstanding ..............$600 Additional paid...

Q: Pam Corporation pays $300,000 for a 30 percent interest

Pam Corporation pays $300,000 for a 30 percent interest in Sun Corporation on July 1, 2016, when the book value of Sun’s identifiable net assets equals fair value. Information relati...

Q: A summary of changes in the stockholders’ equity of Sun Corporation from

A summary of changes in the stockholders’ equity of Sun Corporation from January 1, 2016, to December 31, 2017, appears as follows (in thousands): Pam Corporation purchases 40,000...