Virginia Corp

question 65

Essay

Virginia Corp. owned all of the voting common stock of Stateside Co. Both companies use the perpetual inventory method, and Virginia decided to use the partial equity method to account for this investment. During 2012, Virginia made cash sales of $400,000 to Stateside. The gross profit rate was 30% of the selling price. By the end of 2012, Stateside had sold 75% of the goods to outside parties for $420,000 cash.
Prepare the consolidation entries that should be made at the end of 2012.

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Definitions:

Power Bases

The sources of influence and authority an individual or organization possesses, which can include factors like expertise, control of resources, and formal positions.

Social Capital

The networks, relationships, and social connections that provide individuals and groups with valuable resources, information, and support.

Sources of Power

The origins from which an individual or organization derives the ability to influence others, such as authority, knowledge, or relationships.

Retaining Humility

The practice of maintaining a modest view of one's own importance, even in the face of success or achievement.