Chap007_Day2

Chap007_Day2 - COGS xx sold this year Where xx= beginning...

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1 Chapter 7 -- Basic Form of Elimination Entries in Year of Sale ± Sales (intercorporate sale) COGS (plug) Inventory (unrealized profit) unrealized profit = intercorporate profit * % unsold ± If Upstream Sale, add this entry to eliminate MI’s share of unrealized profit. MI - B/S (unrealized profit * MI %) MI- I/S (unrealized profit * MI %)
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2 Chapter 7 -- Basic Form of Elimination Entries Year After Sale ± Downstream Sale R/E, Jan 1 xx Inventory xx * % unsold this year
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Unformatted text preview: COGS xx * % sold this year Where xx= beginning bal. of unrealized intercorprate profit 3 ± If Upstream Sale, do this entry instead R/E, Jan 1 xx * CI% MI - B/S xx * MI% Inventory xx * % unsold this year COGS xx * % sold this year ± In addition, assign MI its share of realized profit of this year MI - I/S ( xx * % sold this year)*MI% MI – B/S ( xx * % sold this year)*MI% Where xx= beginning bal. of unrealized intercorprate profit...
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This note was uploaded on 05/01/2010 for the course MGMT 503 taught by Professor Staff during the Spring '08 term at Purdue.

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Chap007_Day2 - COGS xx sold this year Where xx= beginning...

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