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Question 2: (30 points) Planner Corporation acquired 90 percent of Schedule Company's common stocks in...

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Question 2: (30 points) Planner Corporation acquired 90 percent of Schedule Company's common stocks in 2018. During 2019, Planner purchased 5,500 bags of cement for $72 each and sold 3,500 of them to Schedule for $90 each. Schedule sold 2,600 of the bags of cement to non-associate retail store prior to December 31, 2019, for $120 each. Both companies use perpetual inventory systems. Required: A. Give the journal entries Planner recorded for the purchase of inventory and resale to Schedule Company in 2019. (12 points) B. Give the journal entries Schedule recorded for the purchase of inventory and resale to retail stores in 2019. (12 points) C. Give the worksheet consolidation journal entry(ies) needed in preparing consolidated financial statements for 2019 to remove all effects of the intercompany sale. (6 points) Question 3: (20 points) A. Why must intercompany inventory transfers be eliminated in preparing consolidated financial statements? Explain with an example. (10 points) B. Explain with examples, the difference between Arm's-Length Transactions and Non-Arm's- Length Transactions. (10 points)

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