Solution to Chapter 5 Sample Quiz

# Solution to Chapter 5 Sample Quiz - Indiana University of...

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Indiana University of Pennsylvania Department of Accounting ACCT 401/501: Advanced Accounting Dr. Rahman Solution to Sample Quiz for Chapter 5 Part I. 1. C 2. C 3. A 2008 combined sales \$920,000 Less: 2008 intercompany sales (50,000) Consolidated sales \$870,000 4. A Selling price \$50,000 Less: Cost of sales 40,000 Original unrealized profit 10,000 Unsold percentage 30% Unrealized profit \$ 3,000 5. A Eagle net Income \$180,000 Add: Flyway’s Net income \$76,000 X .8 60,800 Deduct: Unrealized profit in Ending Inventory (3,000 ) \$237,800. 6. A 7. D \$300,000 + \$180,000 - \$3,000 = \$477,000. 8. A \$500,000 + \$400,000 - \$200,000 = \$\$700,000 - \$20,000. 9. B \$120,000 X .8 = \$96,000 - \$20,000 = \$76,000. 10. D 11. C \$520,000 + \$12,500 - \$10,000 = \$522,500 12. B \$62,500 X .2 = \$12,500. 13. A

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Part II Requirement 1 Unrealized profit in inventory: \$132,000 – (\$132,000/1.2) = \$ 22,000 Requirement 2 Income from Salt for 2009: Share of Salt’s income (\$880,000 x 60%) \$ 528,000 Less: Unrealized profit in ending inventory
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## This note was uploaded on 12/08/2011 for the course ACCT 101 taught by Professor Joe during the Spring '11 term at IUP.

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Solution to Chapter 5 Sample Quiz - Indiana University of...

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