Company P owns 60% of Company S1 and 90% of Company S2. S1 sells inventory to S2

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Company P owns 60% of Company S1 and 90% of Company S2. S1 sells inventory to S2 at a profit of $ 20,000. All the goods are still in S2’s inventory at year-end. By what amount should consolidated net income be adjusted to eliminate the unrealized profit?

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Advanced Financial Accounting

ISBN: 978-0137030385

6th edition

Authors: Thomas Beechy, Umashanker Trivedi, Kenneth MacAulay

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