P Company regularly sells merchandise to its 80%-owned subsidiary, S Corporation. In 2016, P sold merchandise that cost $192,000 to S for $240,000. Half of this merchandise remained in S's December 31, 2016 inventory. During 2017, P sold merchandise that cost $300,000 to S for $375,000. Forty percent of this merchandise inventory remained in S's December 31, 2017 inventory. Selected income statement information for the two affiliates for the year 2017 is as follows: Consolidated cost of goods sold for P Company and Subsidiary for 2017 are:
A) $1,809,000.
B) $1,815,000.
C) $1,821,000.
D) $2,190,000.

Question

P Company regularly sells merchandise to its 80%-owned subsidiary, S Corporation. In 2016, P sold merchandise that cost $192,000 to S for $240,000. Half of this merchandise remained in S's December 31, 2016 inventory. During 2017, P sold merchandise that cost $300,000 to S for $375,000. Forty percent of this merchandise inventory remained in S's December 31, 2017 inventory. Selected income statement information for the two affiliates for the year 2017 is as follows:  Consolidated cost of goods sold for P Company and Subsidiary for 2017 are:
A) $1,809,000. 
B) $1,815,000. 
C) $1,821,000. 
D) $2,190,000.

Quizplus · Accepted Answer

The Answer of P Company regularly sells merchandise to its 80%-owned subsidiary, S Corporation. In 2016, P sold merchandise that cost $192,000 to S for $240,000. Half of this merchandise remained in S's December 31, 2016 inventory. During 2017, P sold merchandise that cost $300,000 to S for $375,000. Forty percent of this merchandise inventory remained in S's December 31, 2017 inventory. Selected income statement information for the two affiliates for the year 2017 is as follows:  Consolidated cost of goods sold for P Company and Subsidiary for 2017 are:
A) $1,809,000. 
B) $1,815,000. 
C) $1,821,000. 
D) $2,190,000.

P Company Regularly Sells Merchandise to Its 80%-Owned Subsidiary, S