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

Exercise 40

Barker Company owns 80 percent of the outstanding voting stock of Walden Company. During the current year, intra-entity sales amount to $100,000.These transactions were made with a gross profit rate of 40 percent of the transfer price. Inconsolidating thetwo companies, what amount of these sales would be eliminated