Strickland Company Sells Inventory to Its Parent, Carter Company, at a Profit

question 121

Multiple Choice

Strickland Company sells inventory to its parent, Carter Company, at a profit during 2012. One-third of the inventory is sold by Carter in 2012.
In the consolidation worksheet for 2012, which of the following choices would be a debit entry to eliminate the intra-entity transfer of inventory?

• A) Retained earnings.
• B) Cost of goods sold.
• C) Inventory.
• D) Investment in Strickland Company.
• E) Sales.

---

Definitions:

Independent Think Tank

An organization that conducts research and engages in advocacy in areas such as social policy, political strategy, economics, military, technology, and culture, independent of government or corporate influence.

Equality

The state of being equal, especially in status, rights, and opportunities, without discrimination based on race, gender, or other personal characteristics.

Lesbian

A woman who experiences romantic or sexual attraction solely or primarily to other women.

Sexual Harassment

Unwelcome sexual advances, requests for sexual favors, and other verbal or physical conduct of a sexual nature that can affect a person's work environment or create a hostile workplace.