REFERENCE: Ref.05_03
Strickland Company sells inventory to its parent,Carter Company,at a profit during 2009.Select the correct answer.
-With regard to the intercompany sale,which of the following choices would be a credit entry in the consolidated worksheet for 2010?

Question

Quizplus · Accepted Answer

When intercompany sales occur, the selling company's cost of goods sold is reduced and the buying company's inventory is increased. Therefore, the credit entry in the consolidated worksheet for 2010 would be Cost of goods sold.

REFERENCE: Ref.05_03 Strickland Company Sells Inventory to Its Parent,Carter Company,at a Profit