Show your solution. Transcribed Image Text: Cassowary Corporation acquired a 70% interest in Fruit Corporation in
1999 at a time when Fruit’s book values and fair values were equal.
In 2003, Fruit sold land to Cassowary for $82,000 that cost $72,000.
The land remained in Cassowary’s possession until 2005 when Cassowary
sold it outside the combined entity for $102,000.
After the books were closed in 2005, it was discovered that Cassowary
had not considered the unrealized gain from its intercompany purchase
of land in preparing the consolidated financial statements. The only
entry on Cassowary’s books was a debit to Land and a credit to Cash
in 2003 for $82,000, and, in 2005, a debit to Cash for $102,000 and
credits to Land for $82,000 and Gain on sale of land for $20,000.
of the error,
Before the discovery
statements disclosed the following amounts:
Consolidated net income
1. Determine the
of consolidated net
2003, 2004, and 2005.
Do you need us to help you on this or any other assignment?
Make an Order Now