Power Products Corporation, which sells a broad line of home detergent products, owns 75 percent of the stock of Scrub Soap Company. During 20x8, Scrub sold soap products to Power Products for $180,000, which it had produced for $120,000. Power Products sold $150,000 of its purchase from Scrub in 20X8 and the remainder in 20X9. In addition, Power Products purchased $240,000 of inventory from Scrub in 20x9 and resold $90,000 of the items before year-end. Scrub's cost to produce the items sold to Power Products in 20x9 was $160,000. Required: a. Prepare the worksheet consolidation entries needed for December 31, 20X9, to remove the effects of the intercompany inventory transfers in 20X8 and 20x9. Note: If no entry is required for a transaction/event, select "No journal entry required" In the first account field. view transaction t Consolidation Worksheet Entries A B Record the entry to reverse the 20X8 gross profit deferral. Note: Enter debits before credits. Entry 1 Accounts Debit Credit Record entry Clear entry view consolidation entries b. Compute the amount of income assigned to noncontrolling shareholders in the 20X8 and 20x9 consolidated income statements if Scrub reported net income of $350,000 for 20X8 and $420,000 for 20x9. 20X8 2009 Income assigned to noncontrolling interest
Power Products Corporation, which sells a broad line of home detergent products, owns 75 percent of the stock of Scrub Soap Company. During 20x8, Scrub sold soap products to Power Products for $180,000, which it had produced for $120,000. Power Products sold $150,000 of its purchase from Scrub in 20X8 and the remainder in 20X9. In addition, Power Products purchased $240,000 of inventory from Scrub in 20x9 and resold $90,000 of the items before year-end. Scrub's cost to produce the items sold to Power Products in 20x9 was $160,000. Required: a. Prepare the worksheet consolidation entries needed for December 31, 20X9, to remove the effects of the intercompany inventory transfers in 20X8 and 20x9. Note: If no entry is required for a transaction/event, select "No journal entry required" In the first account field. view transaction t Consolidation Worksheet Entries A B Record the entry to reverse the 20X8 gross profit deferral. Note: Enter debits before credits. Entry 1 Accounts Debit Credit Record entry Clear entry view consolidation entries b. Compute the amount of income assigned to noncontrolling shareholders in the 20X8 and 20x9 consolidated income statements if Scrub reported net income of $350,000 for 20X8 and $420,000 for 20x9. 20X8 2009 Income assigned to noncontrolling interest
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Power Products Corporation, which sells a broad line of home detergent products, owns 75 percent of the stock of Scrub Soap
Company. During 20X8, Scrub sold soap products to Power Products for $180,000, which it had produced for $120,000. Power
Products sold $150,000 of its purchase from Scrub in 20X8 and the remainder in 20X9. In addition, Power Products purchased
$240,000 of inventory from Scrub in 20x9 and resold $90,000 of the items before year-end. Scrub's cost to produce the items sold to
Power Products in 20X9 was $160,000.
Required:
a. Prepare the worksheet consolidation entries needed for December 31, 20X9, to remove the effects of the intercompany inventory
transfers in 20X8 and 20×9.
Note: If no entry is required for a transaction/event, select "No journal entry required" In the first account field.
view transaction list
Consolidation
Worksheet Entries
< A
B
Record the entry to reverse the 20X8 gross profit deferral.
Note: Enter debits before credits.
Entry
1
Accounts
Debit
Credit
Record entry
Clear entry
view consolidation entries
b. Compute the amount of income assigned to noncontrolling shareholders in the 20X8 and 20x9 consolidated income statements if
Scrub reported net income of $350,000 for 20X8 and $420,000 for 20×9.
20X8
20X9
Income assigned to noncontrolling interest
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