Question

New Jersey Company owns 80% of the common stock of Newark, Inc. In 2012, New Jersey reported sales of $300,000, and Newark reported sales of $100,000, including sales to New Jersey of $20,000. The amount of sales that should be reported in the consolidated income statement for 2012 is:

Answer 1

Answer: $380,000

Explanation:

From the question, we are informed that New Jersey Company owns 80% of the common stock of Newark, Inc. In 2012, New Jersey reported sales of $300,000, and Newark reported sales of $100,000, including sales to New Jersey of $20,000.

Based on the above information, the amount of sales that should be reported in the consolidated income statement for 2012 will be:

$300000 + $100000 - $20,000

= $380000