Parent Corporation purchased land from S1 Corporation for $220,000 on December 26,20X8.This purchase followed a series of transactions between P-controlled subsidiaries.On February 15,20X8,S3 Corporation purchased the land from a nonaffiliate for $160,000.It sold the land to S2 Company for $145,000 on October 19,20X8,and S2 sold the land to S1 for $197,000 on November 27,20X8.Parent has control of the following companies:
Parent reported income from its separate operations of $200,000 for 20X8.
-Based on the preceding information,at what amount should the land be reported in the consolidated balance sheet as of December 31,20X8?
A)$145,000
B)$220,000
C)$197,000
D)$160,000

Question

Parent Corporation purchased land from S1 Corporation for $220,000 on December 26,20X8.This purchase followed a series of transactions between P-controlled subsidiaries.On February 15,20X8,S3 Corporation purchased the land from a nonaffiliate for $160,000.It sold the land to S2 Company for $145,000 on October 19,20X8,and S2 sold the land to S1 for $197,000 on November 27,20X8.Parent has control of the following companies:
  Parent reported income from its separate operations of $200,000 for 20X8.
-Based on the preceding information,at what amount should the land be reported in the consolidated balance sheet as of December 31,20X8?
A)$145,000 
B)$220,000 
C)$197,000 
D)$160,000

Quizplus · Accepted Answer

The Answer of Parent Corporation purchased land from S1 Corporation for $220,000 on December 26,20X8.This purchase followed a series of transactions between P-controlled subsidiaries.On February 15,20X8,S3 Corporation purchased the land from a nonaffiliate for $160,000.It sold the land to S2 Company for $145,000 on October 19,20X8,and S2 sold the land to S1 for $197,000 on November 27,20X8.Parent has control of the following companies:
  Parent reported income from its separate operations of $200,000 for 20X8.
-Based on the preceding information,at what amount should the land be reported in the consolidated balance sheet as of December 31,20X8?
A)$145,000 
B)$220,000 
C)$197,000 
D)$160,000

Parent Corporation Purchased Land from S1 Corporation for $220,000 on December