During 2011, Edwards Co. sold inventory to its parent company, Forsyth - 12486

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  • Posted on: Mon 16 Jul, 2012
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Request Description

 

During 2011, Edwards Co. sold inventory to its parent company, Forsyth Corp. Forsyth still owned all of the inventory at the end of 2011. What type of sale is this? How is the gross profit on the sale recognized in the consolidated financial statements for 2011? Why?  

 

Solution Description

 

During 2011, Edwards Co. sold inventory to its parent company, Forsyth Corp. Forsyth still owned all of the inventory at the end of 2011.