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Question: st paul sewer inc purchased 70 of pipestone pipe inc...

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  1. St. Paul Sewer Inc. purchased 70% of Pipestone Pipe Inc. in a Stock Acquisition. The CEO of St. Paul Sewer Inc. mentioned that there is an accounts receivable due from Pipestone Pipe Inc. in the amount of $12,000. How should St. Paul Sewer Inc. account for this inter-company (affiliated company) receivable? Provide the journal entry with your explanation.
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