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

question 10

Multiple Choice

A subsidiary entity sold inventory to its parent entity at a profit of $4 000.The goods had originally cost the subsidiary $10 000.At the end of the year all the inventory was still on hand.The adjustment entry to deal with this transaction on consolidation would include the following line item:

• A)CR Inventory $4 000
• B)CR Inventory $6 000
• C)CR Inventory $10 000 d,CR Inventory $14 000.

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Definitions:

Many Uses

A characteristic of products or services that can be utilized in multiple ways or for various purposes, enhancing their appeal.

Production

The process of creating goods and services through the combination of labor, materials, and technology.

Promotional Mix

The combination of marketing strategies and tactics used by a company to promote its products or services, including advertising, sales promotions, public relations, and direct marketing.

Inspiration

The process of being mentally stimulated to do or feel something, especially to do something creative or achieve goals.