Company P holds 70 percent of the voting shares of Company S.During 20X8,Company S sold land with a book value of $125,000 to Company P for $150,000.Company P continues to hold the land at the end of the year.The companies file separate tax returns and are subject to a 40 percent tax rate.Assume that Company P uses the fully adjusted equity method in accounting for its investment in Company S.
-Based on the information given,which consolidating entry relating to the intercorporate sale of land is to be entered in the consolidation worksheet prepared at the end of 20X8?

A)Option A
B)Option B
C)Option C
D)Option D

Question

Company P holds 70 percent of the voting shares of Company S.During 20X8,Company S sold land with a book value of $125,000 to Company P for $150,000.Company P continues to hold the land at the end of the year.The companies file separate tax returns and are subject to a 40 percent tax rate.Assume that Company P uses the fully adjusted equity method in accounting for its investment in Company S.
-Based on the information given,which consolidating entry relating to the intercorporate sale of land is to be entered in the consolidation worksheet prepared at the end of 20X8?

A)Option A 
B)Option B 
C)Option C 
D)Option D

Quizplus · Accepted Answer

The Answer of Company P holds 70 percent of the voting shares of Company S.During 20X8,Company S sold land with a book value of $125,000 to Company P for $150,000.Company P continues to hold the land at the end of the year.The companies file separate tax returns and are subject to a 40 percent tax rate.Assume that Company P uses the fully adjusted equity method in accounting for its investment in Company S.
-Based on the information given,which consolidating entry relating to the intercorporate sale of land is to be entered in the consolidation worksheet prepared at the end of 20X8?

A)Option A 
B)Option B 
C)Option C 
D)Option D

Company P Holds 70 Percent of the Voting Shares of Company