Swift plc acquired 75% of equity shares in Wren plc on January 20X6, when Wren's retained...

Swift plc acquired 75% of equity shares in Wren plc on January 20X6, when Wren's retained earnings were 124,000$. An extract from the statements of income of both companies for the year ended 31 December 20X8 was as follows:

Income statements	Swift	Wren
For the year ended 31.12.20X8	$' 000	$'000
Sales revenue	7,200	1,600
cost of sales	(5,450)	(942)
Gross profit	1,750	658

During the year ended 31 December 20X8, Swift sold goods invoiced at 400,000$ to Wren at cost plus a third. 80,000$ of these goods remain with Wren at the year end.

What is the consolidated gross profit?

Expert Solution

Calculation Of Consolidated Gross Profit

Notes

Alternatively, it can be calculated as follows

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ekkarill92 answered 1 year ago

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