James, Inc., sells inventory to Matthews Company, a related party, at Jamess standard markup. At the current

Question:

James, Inc., sells inventory to Matthews Company, a related party, at James’s standard markup. At the current fiscal year-end, Matthews still holds some portion of this inventory. If consolidated are prepared, why are worksheet entries required in two different fiscal periods?

Financial Statements
Financial statements are the standardized formats to present the financial information related to a business or an organization for its users. Financial statements contain the historical information as well as current period’s financial...