What is the adjustment entry in the consolidation worksheet

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Problem 1: During the current period, a subsidiary entity sold inventories to a parent entity for $40 000. The inventories had previously cost the subsidiary entity $36 000. By reporting date the parent entity had sold 75% of inventories to a party outside the group. The company tax rate is 30%. What is the adjustment entry in the consolidation worksheet at reporting date?

DR Sales Revenue 40,000
CR Cost of Sales 39,000
CR Inventories 1,000

DR Deferred Tax Asset 300
CR Income Tax Expense 300

Reference no: EM132973901

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