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King CorpOwns 85% of James Co

question 29

Essay

King Corp.owns 85% of James Co.King uses the equity method to account for its investments.During 2018, King sells inventory to James for $500,000.The inventory originally cost King $420,000.At 12/31/2018, 25% of the goods were still in James' inventory.
Required:
Prepare the Consolidation Entry TI and Consolidation Entry G for the consolidation worksheet.


Definitions:

Arbitrary Value

A value or figures assigned based on random choice or personal whim, rather than any reason or system.

Upper Limit

The maximum level or point that is considered acceptable or achievable.

Absolute Threshold

The minimum intensity of a stimulus that can be detected by the senses at least 50% of the time.

Difference Threshold

The smallest amount by which a stimulus must be changed in order to produce a noticeable variation in sensory experience.

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