Multiple- Year Elimination Entries — Upstream Sales In 2006, Pota Inc. acquired inventory from Sota Inc., its 75%-owned subsidiary, for $100,000. Sota’s cost was $80,000: Pota resold a portion of this inventory in 2006 for $90,000. At 12/31/06, Pota’s balance sheet showed $40,000 of inter¬

company-acquired inventory on hand. Pota resold this remaining inventory in 2008 for $52,000.

1. Prepare the general ledger adjusting entry(ies) required for 2006, 2007, and 2008, if necessary, under the complete equity method. Omit this requirement if you are using Module 2.

2. Prepare the consolidation elimination entry(ies) at the end of 2006, 2007, and 2008 relating to these intercompany inventory sales.

3. At what amount is the inventory reported in the consolidated statements at the end of 2006 and 2007?