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Advanced Financial > Ch. 5 - Consolidated Financial Stmts - Intra-Entity Asset Transactions > Flashcards

Ch. 5 - Consolidated Financial Stmts - Intra-Entity Asset Transactions Flashcards

1
Q

What is the purpose of worksheet entry *G in a downstream sale?

A

Removal of unrealized Gross Profit from beginning figures so that it can be recognized in the current period. Downstream sales to parent.

*G Increases investment & decreases COGS in downstream transaction.

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2
Q

What is the purpose of worksheet entry S in a downstream sale?

A

Elimination of Stockholders’ equity and recognition of NCI at BOY.

Beg R/E DR
Cap Stock DR
Investment CR
NCI (%) CR

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3
Q

What is the purpose of worksheet entry A in a downstream sale?

A

Allocation of excess FV over sub’s BV unamortized @ BOY

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Advanced Financial (5 decks)

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