Given the following separate company balance sheets and income statements, answer the following questions.

Additional information:
Plea acquired its investment in the stock of Settle on the date of Settle’s incorporation.
Consolidated accounts receivable is $80,000.
Consolidated sales total $900,000.
No purchases from Settle remain in Plea’s ending inventory.

Required:

a. What percentage of Settle does Plea appear to own?
b. What is beginning retained earnings of Plea?
c. How much was Plea’s initial investment in Settle?
d. What is the amount of intercompany accounts receivable?
e. What is consolidated cost of goods sold?

Question

Given the following separate company balance sheets and income statements, answer the following questions.

Additional information:
Plea acquired its investment in the stock of Settle on the date of Settle’s incorporation.
Consolidated accounts receivable is $80,000.
Consolidated sales total $900,000.
No purchases from Settle remain in Plea’s ending inventory.

Required:

a.	What percentage of Settle does Plea appear to own?
b.	What is beginning retained earnings of Plea?
c.	How much was Plea’s initial investment in Settle?
d.	What is the amount of intercompany accounts receivable?
e.	What is consolidated cost of goods sold?

Quizplus · Accepted Answer

The Answer of Given the following separate company balance sheets and income statements, answer the following questions.

Additional information:
Plea acquired its investment in the stock of Settle on the date of Settle’s incorporation.
Consolidated accounts receivable is $80,000.
Consolidated sales total $900,000.
No purchases from Settle remain in Plea’s ending inventory.

Required:

a.	What percentage of Settle does Plea appear to own?
b.	What is beginning retained earnings of Plea?
c.	How much was Plea’s initial investment in Settle?
d.	What is the amount of intercompany accounts receivable?
e.	What is consolidated cost of goods sold?

Given the Following Separate Company Balance Sheets and Income Statements