For consolidation purposes, what amount would be debited to cost of goods sold for the 2011 consolidation worksheet with regard to the unrealized gross profit of the 2011 intra-entity transfer of merchandise?
A) $1,000.
B) $800.
C) $3,000.
D) $2,400.
E) $900.

Question

Quizplus · Accepted Answer

The unrealized gross profit on the intra-entity transfer of merchandise is $1,000 ($4,000 - $3,000). This amount should be debited to cost of goods sold in the consolidation worksheet to eliminate the intercompany profit.

For Consolidation Purposes, What Amount Would Be Debited to Cost