Prego owns 100% of Spacci.Below you will find the financial statements of both firms.Find consolidated sales.PregoSalesPurchases from SubsidiaryOther COGSGross ProfitSG&AOperating ProfitInterest ExpenseInterest Income from SubsidiaryEarnings before tax1TaxNet Income.SpacelProfit & LossCOGSGross ProfitSG&ASales to ParentSales to nonrelated partiesTotal SalesProfit & LossTaxNet IncomeOperating ProfitInterest Expense for Loan from ParentInterest Expense for Bank LoansEarnings before tax7,500(3,750)(2,250)1,500(750)750(75)38713(150)5633,7502,2506,000(4,500)1,500(750)750(38)(1)711(20)691CashAccount Receivable from nonrelated partiesInventoryTotal current assetsNet PP&ELoan to SubsidiaryInvestment in SubsidiaryTotal AssetsCashAccount Receivable from ParentInventoryTotal current assetsNet PP&ETotal AssetsBalance Sheet75225753753753753001,425Balance Sheet300225150675300975Account payable to SubsidiaryAccount payable to third partyTotal current liabilitiesBank loansTotal EquityTotal Liabilities & EquityAccount payable to third partyTotal current liabilitiesBank loansLoans from ParentTotal EquityTotal Liabilities & Equity225300Show all results with one decimal for numbers and two decimals for percent responses using thefollowing format: 1,234.5 or 12.32%. For any questions requiring days, assume a 365 day year.5253755251,42537537575375150975

When a company purchases more than 50% of the voting rights of another company, it becomes the…

Answered: Prego owns 100% of Spacci. Below you…

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Prego owns 100% of Spacci. Below you will find the financial statements of both firms.

Financial Reporting, Financial Statement Analysis and Valuation

8th Edition

ISBN:9781285190907

Author:James M. Wahlen, Stephen P. Baginski, Mark Bradshaw

Publisher:James M. Wahlen, Stephen P. Baginski, Mark Bradshaw

Chapter6: Accounting Quality

Section: Chapter Questions

Problem 2IC

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Question

Prego owns 100% of Spacci.
Below you will find the financial statements of both firms.
Find consolidated sales.
Prego
Sales
Purchases from Subsidiary
Other COGS
Gross Profit
SG&A
Operating Profit
Interest Expense
Interest Income from Subsidiary
Earnings before tax
1
Tax
Net Income.
Spacel
Profit & Loss
COGS
Gross Profit
SG&A
Sales to Parent
Sales to nonrelated parties
Total Sales
Profit & Loss
Tax
Net Income
Operating Profit
Interest Expense for Loan from Parent
Interest Expense for Bank Loans
Earnings before tax
7,500
(3,750)
(2,250)
1,500
(750)
750
(75)
38
713
(150)
563
3,750
2,250
6,000
(4,500)
1,500
(750)
750
(38)
(1)
711
(20)
691
Cash
Account Receivable from nonrelated parties
Inventory
Total current assets
Net PP&E
Loan to Subsidiary
Investment in Subsidiary
Total Assets
Cash
Account Receivable from Parent
Inventory
Total current assets
Net PP&E
Total Assets
Balance Sheet
75
225
75
375
375
375
300
1,425
Balance Sheet
300
225
150
675
300
975
Account payable to Subsidiary
Account payable to third party
Total current liabilities
Bank loans
Total Equity
Total Liabilities & Equity
Account payable to third party
Total current liabilities
Bank loans
Loans from Parent
Total Equity
Total Liabilities & Equity
225
300
Show all results with one decimal for numbers and two decimals for percent responses using the
following format: 1,234.5 or 12.32%. For any questions requiring days, assume a 365 day year.
525
375
525
1,425
375
375
75
375
150
975

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