A Subsidiary Entity Sold Goods to Its Parent Entity for $100

question 24

Multiple Choice

A subsidiary entity sold goods to its parent entity for $100 000.The inventory originally cost the subsidiary $125 000.At reporting date,the parent still held all of the inventory.Which of the following adjustments must be included as part of the consolidation entry to eliminate this transaction?

• A)Cr Inventory $100 000
• B)Cr Inventory $125 000
• C)Dr Inventory $25 000
• D)Dr Inventory $225 000

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Definitions:

Quick Response (QR)

A technology that uses barcodes to provide instant access to information via a smartphone scan, often used for marketing, payment, or product information.

Fashion Clothing

Apparel designed and marketed to reflect current trends, styles, and aesthetics in the fashion industry.

Strategic Relationship

A partnership or alliance between two or more entities to pursue a set of agreed upon objectives while remaining independent organizations.

Characteristics

Distinctive features or qualities that define and distinguish a person, object, or concept.