What would be Y adjusted net income for the year

Assignment Help Accounting Basics

Reference no: EM132737270

Question - X Inc. owns 80% of Y Inc. During 2020, X Inc. sold inventory to Y for $10,000. Half of this inventory remained in Y's warehouse at year end.

Y Inc. sold Inventory to X Inc. for $5,000. 40% of this inventory remained in X's warehouse at year end.

Both companies are subject to a tax rate of 40%. The gross profit percentage on sales is 20% for both companies. Unless otherwise stated, assume X Inc. uses the cost method to account for its Investment in Y Inc.

Assume that Y Inc. reported an after-tax net income of $20,000 in 2020, what would be Y's adjusted net income for the year?

a. $20,000

b. $19,760

c. $19,840

d. $202,400

Reference no: EM132737270

Questions Cloud

Two primary information security threats facing wal-mart : What would you consider to be the two primary information security threats facing Wal-Mart? What should Wal-Mart do to deal with each of them?

Policy or contract of each health care plan : Health care organizations that participate in all of the health care plans are reimbursed according to the policy or contract of each health care plan.

Evaluate how the findings might apply to a clinical setting : Evaluate how the findings might apply to a clinical setting, such as Alzheimer's disease, anterograde or retrograde amnesia, or a condition such.

Find and make a journal related to the transaction : January 1, 2021 and sold to third parties on January 15, 2021 for IDR 3.5 million per head, make a journal related to the transaction during 2021!

What would be Y adjusted net income for the year : Assume that Y Inc. reported an after-tax net income of $20,000 in 2020, what would be Y's adjusted net income for the year

Regulations for these five health insurance plans : What are the consequences of not following the rules and regulations for these five health insurance plans?

Critically evaluate the literature on audit expectation gap : Critically evaluate the above statement with reference to the literature on audit expectation gap

Formulate the bank reconciliation statement as at september : Formulate the Bank Reconciliation Statement as at 30 September 2020. At 30 September 2020, the Cash Book of Gollem Enterprise shows a debit balance

Discuss the impact on the financial statements : Discuss the impact on the financial statements and of the audit of each issue, including an assessment of whether it is material

User Account

All Pages