Asked by Timyia Thomas on Jul 04, 2024
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How do upstream and downstream inventory transfers differ in their effect in a year-end consolidation?
Upstream Inventory Transfers
Transactions where goods are sent from a subsidiary to the parent company, often analyzed for transfer pricing and tax purposes.
Downstream Inventory Transfers
The movement of inventory from a parent company to a subsidiary or between subsidiaries, typically involving finished goods or products closer to the end of the supply chain.
Year-end Consolidation
The process of combining and integrating all financial statements and data of a corporation and its subsidiaries at the end of the fiscal year to produce consolidated financial statements.
- Understand the impact of upstream and downstream inventory transfers in consolidated financial statements.
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Learning Objectives
- Understand the impact of upstream and downstream inventory transfers in consolidated financial statements.
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