For Consolidation Purposes, What Amount Would Be Debited to Cost

question 56

Multiple Choice

For consolidation purposes, what amount would be debited to cost of goods sold for the 2018 consolidation worksheet with regard to the unrecognized intra-entity gross profit remaining in ending inventory with respect to the 2018 transfer of merchandise?

• A) $1,000.
• B) $ 800.
• C) $3,000.
• D) $2,400.
• E) $ 900.

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Definitions:

Sustainable Growth

The rate at which a company can grow its sales, profits, and dividends without having to increase equity or debt financing.

Dividend Payout Ratio

A financial metric that indicates the percentage of a company's earnings paid out to shareholders in the form of dividends.

Current Assets

Assets of a company that are expected to be sold, consumed, or converted into cash within one year or within the normal operating cycle of the business.

Average Collection Period

A metric that calculates the average time taken to receive payments from customers, indicating the efficiency of a company's credit and collection policies.