Gargiulo Company, a 90% owned subsidiary of Posito Corporation, sells inventory to Posito at a 25% profit on selling price. The following data are available pertaining to intra-entity purchases. Gargiulo was acquired on January 1, 2012. 
Assume the equity method is used. The following data are available pertaining to Gargiulo's income and dividends. 
For consolidation purposes, what amount would be debited to January 1 retained earnings for the 2012 consolidation worksheet entry with regard to the unrealized gross profit of the 2012 intra-entity transfer of merchandise?
Definitions:
Medical Supplies
Items used in health care services, including consumables and durable medical equipment.
Journal Entry
A record in accounting that notes every financial transaction of a company, indicating debits and credits to different accounts.
Revokes
The act of cancelling or withdrawing something, such as a law, right, or agreement.
Journal Entries
The record of all financial transactions a business makes, recorded in chronological order in the general ledger.
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