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Upstream sales: Norsk Company routinely purchases goods from its 80%-owned subsidiary, Swede Corporation. In 2016, Swede sold merchandise that cost...
Upstream sales:
Norsk Company routinely purchases goods from its 80%-owned subsidiary, Swede Corporation. In 2016, Swede sold merchandise that cost $80,000 to Norsk for $100,000. Half of this merchandise remained in Norsk's December 31, 2016 inventory. This inventory was sold in 2017. During 2017, Swede sold merchandise that cost $160,000 to Norsk for $200,000. $62,500 of the 2017 merchandise inventory remained in Norsk's December 31, 2017 inventory. Selected income statement information for the two affiliates for the year 2017 was as follows:
