A Parent Sells Merchandise to a Subsidiary at a Markup

A parent sells merchandise to a subsidiary at a markup over its cost. The subsidiary has sold all of the merchandise by year-end. Which of the following working paper eliminating entries are needed to consolidate the financial statements of the parent and subsidiary at year-end, concerning the intercompany sales of merchandise?

A) Debit sales, credit cost of goods sold for the sales value of the merchandise sold by the parent.
B) Debit sales, credit cost of goods sold for the sales value of the merchandise sold by the parent, and debit cost of goods sold and credit ending inventory for the unrealized profit included in the subsidiary's ending inventory.
C) No eliminating entries are required.
D) Debit investment in subsidiary, credit ending inventory for the unrealized profit included in the subsidiary's ending inventory.