ABC Corporation Owns 75 Percent of XYZ Company's Voting Shares

question 22

Multiple Choice

ABC Corporation owns 75 percent of XYZ Company's voting shares. During 20X8, ABC produced 50,000 chairs at a cost of $79 each and sold 35,000 chairs to XYZ for $90 each. XYZ sold 18,000 of the chairs to unaffiliated companies for $117 each prior to December 31, 20X8, and sold the remainder in early 20X9 to unaffiliated companies for $130 each. Both companies use perpetual inventory systems.
-Based on the information given above,what amount of cost of goods sold did ABC record in 20X8?

• A) $2,765,000
• B) $1,620,000
• C) $1,422,000
• D) $2,963,000

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Definitions:

Degrees of Freedom

The count of distinct values or quantities that can change during an analysis while still adhering to all constraints.

Normal Distribution

This refers to a probability distribution characterized by its symmetry about the mean, highlighting that data closer to the mean are encountered more frequently than data far from the mean.

Degrees of Freedom

The number of independent pieces of information used in the calculation of a statistic, often representing the number of values free to vary.

T Distribution

A probability distribution used in statistical analysis when the sample size is small and the population standard deviation is unknown.