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ELIMINATION OF UNREALIZED GAINS OR LOSSES ON INTERCOMPANY SALES OF PROPERTY AND EQUIPMENT

LEARNING OBJECTIVES

images Understand the financial reporting objectives in accounting for intercompany sales of nondepreciable assets on the consolidated financial statements.

images State the additional financial reporting objectives in accounting for intercompany sales of depreciable assets on the consolidated financial statements.

images Explain when gains or losses on intercompany sales of depreciable assets should be recognized on a consolidated basis.

images Explain the term “realized through usage.”

images Describe the differences between upstream and downstream sales in determining consolidated net income and the controlling and noncontrolling interests in consolidated income.

images Compare the eliminating entries when the selling ...

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