Virginia Corp

question 52

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 2010, Virginia made cash sales of $400,000 to Stateside. The gross profit rate was 30% of the selling price. By the end of 2010, 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 2010.

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Definitions:

Series I Savings Bonds

A type of U.S. savings bond designed to protect the value of your cash from inflation.

Qualified Higher Education Expenses

Expenses required for enrollment or attendance at an eligible educational institution, including tuition, fees, books, supplies, and equipment.

AGI

This refers to the measure of income calculated from your gross income and used to determine how much of your income is taxable.

Income

Money received, especially on a regular basis, for work, through investments, or from benefits, that may be subject to taxes.