Select Page
  

Complete the following. Marks are allocated for before tax unrealized profit and after tax unrealized profit. Show calculations for possible part marks.a) P Company sold merchandise to a subsidiary for $64,000. Gross profit rate is 40%. At year end, 20% of this remains unsold. The tax rate is 30%. What is the before tax and after-tax unrealized profit in ending inventory? Please highlight the after-tax unrealized profit in yellow. (2 marks)Clearly indicate your answers as shown below:Calculations:Before tax unrealized profit:After tax unrealized profit:b) P Company sold merchandise to a subsidiary for $63,000. The mark-up on cost in 50%. At year end. 20% of this remains unsold. The tax rate is 30%. What is the before tax and after tax unrealized profit in ending inventory? Please highlight the after-tax unrealized profit in yellow. (2 marks)Clearly indicate your answers as shown below:Calculations:Before tax unrealized profit:After tax unrealized profit:C) AB Company issued a 10 year, 5%, $2,000,000 bond paying interest twice a year at a market rate of 4.2%. What was the issue price? Please highlight the issue price in yellow. (2 marks)