Holiday Bakery owns 60 percent of the stock of Farmco Products. On January 1, 20X9. inventory reported by Holiday Bakery included 20.000 bags of flour purchased from Farmco Products at \(\$ 9\) per bag. By December 31. 20X9. all the beginning inventory purchased from Farmco Products had been baked into products and sold to customers by Holiday Bakery. There were no transactions between Holiday Bakery and Farmco Products during 20X9.

Holiday Bakery owns 60 percent of the stock of Farmco Products. On January 1, 20X9. inventory reported by Holiday Bakery included 20.000 bags of flour purchased from Farmco Products at \(\$ 9\) per bag. By December 31. 20X9. all the beginning inventory purchased from Farmco Products had been baked into products and sold to customers by Holiday Bakery. There were no transactions between Holiday Bakery and Farmco Products during 20X9.

Both Holiday Bakery and Farmco Products price their sales at cost plus 50 percent markup for profit. Holiday Bakery reported income from its baking operations of \(\$ 300,000\), and Farmco Products reported net income of \(\$ 250.000\) for \(20 \mathrm{X} 9\).
\section*{Required}

a. Compute the amount reported as cost of goods sold in the \(20 \mathrm{X} 9\) consolidated income statement for the flour purchased from Farmco Products in 20X8.

b. Give the eliminating entry or entries required to remove the effects of the unrealized profit in beginning inventory in preparing the consolidation workpaper as of December 31, 20X9.

c. Compute the amount reported as consolidated net income for \(20 \mathrm{X} 9\).