Use the Following Information to Answer Bellow Questions

Use the following information to answer bellow Questions
A parent sells merchandise to its subsidiary at a markup of 20% on cost. In the current year, the subsidiary had $120,000 in merchandise purchased from the parent in its beginning inventory. During the current year, the subsidiary paid the parent $720,000 for merchandise, and sold merchandise purchased from the parent to outside customers for $870,000. At year-end, the subsidiary has $180,000 in merchandise purchased from the parent in its ending inventory.
-How do the consolidation working paper eliminating entries affect cost of goods sold?

A) net credit of $700,000
B) net credit of $710,000
C) net credit of $720,000
D) net credit of $690,000