Franklin Ltd

question 36

Multiple Choice

Franklin Ltd. ,a subsidiary of Frayer Ltd. ,sold $500,000 of goods to its parent company in 20X1.At the end of 20X1,some of the goods were not sold and there was $90,000 of unrealized profit associated with these goods.The goods were sold in 20X2.At the end of 20X2,which of the following consolidating entries should be made with respect to the unrealized profits?

Recognize the implications of specialization and trade on national and international levels.

Understand the significance of technological advancements and demographic changes on a nation's economic capabilities.

Differentiate between direct and indirect (opportunity) costs in decision making.

Critically analyze fallacies in economic reasoning and their implications.

---

Definitions:

Operating and Cash Conversion Cycles

Measures of a company's efficiency in managing its operational processes and converting its investments in inventory into cash flows from sales.

Cash Outflows

Money going out of a business, covering expenses such as operating costs, investments, and debt payments.

Inflows

Funds coming into a business from operations, investments, or financing activities.

Borrower in Default

A situation where a borrower fails to meet the legal obligations of a loan, such as not making scheduled payments.