上海对外经贸大学 高级财务会计学笔记-高级财务会计学（英）chapter 6.docVIP

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Copyright?2015PearsonEducation,Inc.

AdvancedAccounting,12e(Beamsetal.)

Chapter6IntercompanyProfitTransactions-PlantAssets

6.1MultipleChoiceQuestions

Usethefollowinginformationtoanswerthequestion(s)below.

In2014,ParlaCorporationsoldlandtoitssubsidiary,SiddCorporation,for$38,000.Ithadabookvalueof$24,000.Inthenextyear,Siddsoldthelandfor$41,000toanunaffiliatedfirm.

1)Whichofthefollowingiscorrect?

A)Noconsolidationworkingpaperentryisrequiredforthistransactionin2014.

B)Aconsolidationworkingpaperentryisrequiredonlyifthesubsidiarywaslessthan100%ownedin2014.

C)AconsolidationworkingpaperentryisrequiredeachyearthatSiddhastheland.

D)Aconsolidatedworkingpaperentrywasrequiredonlyifthelandwasheldforresalein2014.

Answer:C

Objective:LO1

Difficulty:Easy

2)The2014unrealizedgainfromtheintercompanysale

A)shouldberecognizedinconsolidationin2014byaworkingpaperentry.

B)shouldbeeliminatedfromconsolidatednetincomebyaworkingpaperentrythatcreditslandfor$14,000.

C)shouldbeeliminatedfromconsolidatednetincomebyaworkingpaperentrythatdebitslandfor$14,000.

D)shouldbeeliminatedfromconsolidatednetincomebyaworkingpaperentrythatcreditsgainonsaleoflandfor$14,000.

Answer:B

Objective:LO1

Difficulty:Easy

3)OnJanuary1,2014,BiggCorporationsoldequipmentwithabookvalueof$20,000anda10-yearremainingusefullifetoitswholly-ownedsubsidiary,LittleCorporation,for$30,000.BothBiggandLittleusethestraight-linedepreciationmethod,assumingnosalvagevalue.OnDecember31,2014,theseparatecompanyfinancialstatementsheldthefollowingbalancesassociatedwiththeequipment:

Bigg Little

Gainonsaleofequipment $10,000

Depreciationexpense $3,000

Equipment 30,000

Accumulateddepreciation 3,000

Aworkingpaperentrytoconsolidatethefinancialsta