Okavango Ltd. sold goods at a sale price of $10,000 to its 100%-owned subsidiary Serengeti Ltd. in 20X5 at a gross profit percentage of 50%. At the end of 20X5, 40% of the goods purchased from Okavango remained unsold in the ending inventory of Serengeti. These goods were sold by Serengeti to an outside party in 20X6.

Required
a. Provide all the necessary consolidation-related adjusting entries in 20X5 and 20X6 in relation to the sale of inventory by Okavango Ltd. to Serengeti.

b. Would your answer have been different if the sale of the inventory had instead been by Serengeti to Okavango? Explain the rationale for your answer.