(Module 1) In 2006, Salco (a 100%-owned subsidiary of Palco) resold for $66,000 inventory that it had acquired from Palco in 2005 for $40,000. Palco's cost was $23,000. Salco reported $200,000 of net income for 2006.
Required:
a. Prepare the general ledger entry required at the end of 2006 under the complete equity method.
b. Prepare the consolidation entry or entries required at 12/31/06.

Question

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The Answer of (Module 1) In 2006, Salco (a 100%-owned subsidiary of Palco) resold for $66,000 inventory that it had acquired from Palco in 2005 for $40,000. Palco's cost was $23,000. Salco reported $200,000 of net income for 2006.
Required:
a. Prepare the general ledger entry required at the end of 2006 under the complete equity method.
b. Prepare the consolidation entry or entries required at 12/31/06.

(Module 1) in 2006, Salco (A 100%-Owned Subsidiary of Palco)