Advanced Accounting 12th Edition by Joe Ben Hoyle,Thomas Schaefer , Timothy Doupnik

Exercise 9

Tiberend, Inc., sold $150,000 in inventory to Schilling Company during 2014 for $225,000. Schilling resold $105,000 of this merchandise in 2014 with the remainder to be disposed of during 2015. Assuming that Tiberend owns 25 percent of Schilling and applies the equity method, what journal entry is recorded at the end of 2014 to defer the unrealized gross profit