Amount of unrealized gross profit

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Reference no: EM131151254

Panner, Inc., owns 25 percent of Watkins and applies the equity method.

During the current year, Panner buys inventory costing $133,600 and then sells it to Watkins for $167,000. At the end of the year, Watkins still holds only $27,000 of merchandise.

What amount of unrealized gross profit must Panner defer in reporting this investment using the equity method?

Reference no: EM131151254

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