P Company bought 60% of the common stock of S Company on January 1, 2017. On January 1, 2017 there was an intercompany sale of equipment at a gain of $63,000. The equipment had an estimated remaining life of six years. Net incomes of the two companies from their own operations (including sales to affiliates) were as follows:
A. If S Company sold the equipment to P Company, fill in the following matrix: B. If P Company sold the equipment to S Company, fill in the following matrix:

Question

P Company bought 60% of the common stock of S Company on January 1, 2017. On January 1, 2017 there was an intercompany sale of equipment at a gain of $63,000. The equipment had an estimated remaining life of six years. Net incomes of the two companies from their own operations (including sales to affiliates) were as follows:  
A. If S Company sold the equipment to P Company, fill in the following matrix:  B. If P Company sold the equipment to S Company, fill in the following matrix:

Quizplus · Accepted Answer

The Answer of P Company bought 60% of the common stock of S Company on January 1, 2017. On January 1, 2017 there was an intercompany sale of equipment at a gain of $63,000. The equipment had an estimated remaining life of six years. Net incomes of the two companies from their own operations (including sales to affiliates) were as follows:  
A. If S Company sold the equipment to P Company, fill in the following matrix:  B. If P Company sold the equipment to S Company, fill in the following matrix:

P Company Bought 60% of the Common Stock of S