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

question 71

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 credit 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.

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Definitions:

Retina

A thin layer of tissue at the back of the eye that contains cells sensitive to light, which trigger nerve impulses that pass via the optic nerve to the brain.

Upside-Down Image

Refers to the way images are projected onto the retina in the eye, which the brain then interprets and flips to the correct orientation.

Retina

The light-sensitive layer of tissue at the back of the inner eye that converts light images into nerve signals sent to the brain.

Optic Disks

The point in the eye where the optic nerve connects to the retina, lacking photoreceptors, and creating a blind spot.