Loudoun Company and Nelson Company have separate incomes of $77,000 and $85,000,respectively.They had intercompany purchases and sales of $30,000 and intercompany interest of $3,000.Consolidated net income would be

Question

Quizplus · Accepted Answer

To calculate the consolidated net income, we need to subtract intercompany sales and interest from the total income of both companies and add them together.

Total Income = $77,000 + $85,000 = $162,000
Intercompany sales = $30,000
Intercompany interest = $3,000

Consolidated net income = ($77,000 + $85,000 - $30,000 - $3,000) = $129,000

Therefore, the correct answer is B, as it represents the consolidated net income of the two companies.

Loudoun Company and Nelson Company Have Separate Incomes of $77,000