ACCT 451 Assignment 2
Denhjks Gorisdfhev - #3256262 Jan 16th/2018
Assignment #2
Question 1:
Calculations,
Equipment (upstream):
Amount Before Tax Tax(30%) After Tax
Loss on Sale (1800) 540 (1,260)
Depreciation* 45 14 31
(3 Months)
Total Intercompany Loss ($1,755) $526 ($1,229)
*Depreciation: 1800/10(3/12) = 45
Land (Downstream):
Gain on Sale $36,000 (10,800) $25,200
Opening Inventory Sold, Madison:
Opening Inventory Sales Profit $10,800 (3,240) $7,560
Intercompany Sales:
Sales to Madison: $90,000 Madison Sales: $50,400 Unrealized: $39,600
Less: COGS : (54,000) : (27,000) : (27,000)
Profit 36,000 : 23,400 : 12,600
Less: Tax : (10,800) : (7,020) : (3,780)
Net Profit : $25,000 :$16,380 : $8,820
Goodwill:
Acquisition Cost: $849,600
Less Carrying amount of Dobson
Retained Earnings: $273,600
Share Capital: $540,000 $813,600
Goodwill $36,000
Denhjks Gorisdfhev - #3256262 Jan 16th/2018
Assignment #2
Question 1:
Calculations,
Equipment (upstream):
Amount Before Tax Tax(30%) After Tax
Loss on Sale (1800) 540 (1,260)
Depreciation* 45 14 31
(3 Months)
Total Intercompany Loss ($1,755) $526 ($1,229)
*Depreciation: 1800/10(3/12) = 45
Land (Downstream):
Gain on Sale $36,000 (10,800) $25,200
Opening Inventory Sold, Madison:
Opening Inventory Sales Profit $10,800 (3,240) $7,560
Intercompany Sales:
Sales to Madison: $90,000 Madison Sales: $50,400 Unrealized: $39,600
Less: COGS : (54,000) : (27,000) : (27,000)
Profit 36,000 : 23,400 : 12,600
Less: Tax : (10,800) : (7,020) : (3,780)
Net Profit : $25,000 :$16,380 : $8,820
Goodwill:
Acquisition Cost: $849,600
Less Carrying amount of Dobson
Retained Earnings: $273,600
Share Capital: $540,000 $813,600
Goodwill $36,000
