Consolidated Income Statement Data
Master Products acquired 80 percent ownership of LoCal Bakeries on January 1, 20X3, when the fair value of LoCal’s depreciable assets was equal to book value.
Master Products
LoCal Bakeries
Sales
$ 300,000
$ 200,000
Cost of Goods Sold
$200,000
$130,000
Depreciation Expense
40,000
XXXXXXXXXX,000)
30,000
Income before Income from Subsidiary
$ 60,000
Net Income
$ 40,000
During 20X3, Master Products purchased a special imported yeast for $35,000 and resold it to LoCal for $50,000. LoCal did not resell any of the yeast before year-end.
Required
Determine the amounts to be reported for each of the following items in the consolidated income statement for 20X3:
a. Sales.
b. Investment income from LoCal Bakeries.
c. Cost of goods sold.
d. Depreciation expense.
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