On a worksheet prepared to consolidate the financial statements of a parent and subsidiary, eliminating entries made to remove intercompany gains on upstream sales of land sold in prior years, but still held within the consolidated entity, affect which account?

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Eliminating entries for intercompany gains on upstream sales of land sold in prior years but still held within the consolidated entity typically affect the beginning retained earnings account. This adjustment is necessary to remove the unrealized profit from the consolidated financial statements, as the sale is between entities under common control and the land is still within the consolidated group.

On a Worksheet Prepared to Consolidate the Financial Statements of a Parent