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Unformatted text preview: statements serve the needs of managers in the analysis of operating results and financial position of the enterprise as a whole. Combined financial statements also are more appropriate for use by outsiders such as stockholders and creditors. SOLUTIONS TO EXERCISES Ex. 42 a . Journal entries in accounting records of home office: 2005 Sept. 1 Investment in San Marino Branch 10,000 Cash 10,000 2 Investment in San Marino Branch 75,000 Inventories 60,000 Allowance for Overvaluation of Inventories: San Marino Branch ($60,000 x 0.25) 15,000 3 Equipment: San Marino Branch 3,000 Investment in San Marino Branch 3,000 b . Journal entries in accounting records of San Marino Branch: 2005 Sept. 1 Cash 10,000 Home Office 10,000 2 Inventories [$60,000 (1.00 0.20)] 75,000 Home Office 75,000 3 Home Office 3,000 Cash 3,000...
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This homework help was uploaded on 02/16/2008 for the course ACCT 401 taught by Professor Smith during the Spring '08 term at A.T. Still University.
- Spring '08