A Subsidiary Entity Sold Goods to Its Parent Entity at a Profit

question 15

Multiple Choice

A subsidiary entity sold goods to its parent entity at a profit of $10 000.The goods had originally cost the subsidiary $15 000.At reporting date,the parent still held all of the goods.Which of the following adjustments must be included as part of the consolidation entry to eliminate this transaction?

• A)CR Inventory $10 000
• B)CR Inventory $15 000
• C)DR Inventory $25 000
• D)DR Inventory $15 000

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Definitions:

Conscious Awareness

Conscious awareness is the state of being aware of one's own existence, thoughts, emotions, and surroundings at any given moment.

Coping Mechanisms

Strategies or methods employed by individuals to manage stress, adversity, or emotional pain.

Mental And Physical Strength

The combination of cognitive resilience and physical toughness that enables an individual to face and overcome challenges.

Formative Period

A critical phase of development or growth where foundational skills, habits, or structures are established.