# Akron, Inc., owns all outstanding stock of Toledo Corporation. Amortization expense of $15,000 per.. 1 answer below » Akron, Inc., owns all outstanding stock of Toledo Corporation. Amortization expense of$15,000 per year for patented technology resulted from the original acquisition. For 2013, the companies had the following account balances: _________________________________________Akron _____________Toledo Sales. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $1,100,000 ................$600,000 Cost of goods sold . . . . . . . . . . . . . . . . . . . . . . . . . . 500,000 .................400,000 Operating expenses . . . . . . . . . . . . . . . . . . . . . . . . . 400,000 .................220,000 Investment income . . . . . . . . . . . . . . . . . . . . . . . . Not given ......................-0- Dividends paid . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 80,000 ...................30,000 Intra-entity sales of $320,000 occurred during 2012 and again in 2013. This merchandise cost$240,000 each year. Of the total transfers, $70,000 was still held on December 31, 2012, with$50,000 unsold on December 31, 2013. a. For consolidation purposes, does the direction of the transfers (upstream or downstream) affect the balances to be reported here? b. Prepare a consolidated income statement for the year ending December 31, 2013.

KATRAJU S

a. In this business combination, the direction of the intra-entity transfers (either upstream or downstream) is not important to the...

Looking for Something Else? Ask a Similar Question