Problem:
Barnes Company acquired 80 percent of the outstanding voting stock of Dean Company on January 1, 2003. During 2003, Dean Company sold inventory costing $50,000 to Barnes Company for $80,000. Barnes Company continued to hold the inventory at December 31, 2003. Also during 2003, Barnes Company sold merchandise costing $400,000 to non-affiliates for $600,000, and on its separate balance sheet reported total inventory at year-end of $140,000. In its separate financial statements, Dean Company reported total 2003 and ending inventory of $50,000.
Problem:
Based on the above information, compute the amounts that should appear in the consolidated financial statements prepared for Barnes Company and subsidiary, Dean Company, at year-end for the following items:
1) Sales
2) Cost of goods sold
3) Gross profit on sales
4) inventory.