Use the following information for Questions 22 & 23:
P Company regularly sells merchandise to its 80%-owned subsidiary, S Corporation.In 2013, P sold merchandise that cost $192,000 to S for $240,000.Half of this merchandise remained in S's December 31, 2013 inventory.During 2014, P sold merchandise that cost $300,000 to S for $375,000.Forty percent of this merchandise inventory remained in S's December 31, 2014 inventory.Selected income statement information for the two affiliates for the year 2014 is as follows:
-Consolidated sales revenue for P and Subsidiary for 2014 are:
A)$2,325,000.
B)$2,400,000.
C)$2,565,000.
D)$2,700,000.

Question

Use the following information for Questions 22 & 23:
P Company regularly sells merchandise to its 80%-owned subsidiary, S Corporation.In 2013, P sold merchandise that cost $192,000 to S for $240,000.Half of this merchandise remained in S's December 31, 2013 inventory.During 2014, P sold merchandise that cost $300,000 to S for $375,000.Forty percent of this merchandise inventory remained in S's December 31, 2014 inventory.Selected income statement information for the two affiliates for the year 2014 is as follows: 
-Consolidated sales revenue for P and Subsidiary for 2014 are:
A)$2,325,000. 
B)$2,400,000. 
C)$2,565,000. 
D)$2,700,000.

Quizplus · Accepted Answer

Consolidated sales revenue = Sales revenue of P + Sales revenue of Subsidiary= $1,200,000 + $1,125,000= $2,325,000

Use the Following Information for Questions 22 & 23