Purkle Corporation purchased merchandise from its 94%-owned subsidiary, Sterkel Company, at the subsidiary's normal gross margin rate of 25%. Purkle's accounting records for Fiscal Year 2006 show the following with respect to purchases from Sterkel:
Prepare a working paper elimination (in journal entry format) for Purkle Corporation and subsidiary on December 31, 2006. Omit explanation and disregard income taxes.

Question

Purkle Corporation purchased merchandise from its 94%-owned subsidiary, Sterkel Company, at the subsidiary's normal gross margin rate of 25%. Purkle's accounting records for Fiscal Year 2006 show the following with respect to purchases from Sterkel:
  Prepare a working paper elimination (in journal entry format) for Purkle Corporation and subsidiary on December 31, 2006. Omit explanation and disregard income taxes.

Quizplus · Accepted Answer

The Answer of Purkle Corporation purchased merchandise from its 94%-owned subsidiary, Sterkel Company, at the subsidiary's normal gross margin rate of 25%. Purkle's accounting records for Fiscal Year 2006 show the following with respect to purchases from Sterkel:
  Prepare a working paper elimination (in journal entry format) for Purkle Corporation and subsidiary on December 31, 2006. Omit explanation and disregard income taxes.

Purkle Corporation Purchased Merchandise from Its 94%-Owned Subsidiary, Sterkel Company