1. For consolidation purposes, what amount would be debited to cost of goods sold for the 2020 consolidation worksheet with regard to unrecognized intra-entity gross profit remaining in ending inventory with respect to the transfer of merchandise?

a.300 b.240 c.2000 d.1600 e. 270

2. For consolidation purposes, what amount would be debited to cost of goods sold for the 2021 consolidation worksheet with regard to the unrecognized intra-entity gross profit remaining in ending inventory with respect to the 2021 transfer of merchandise?

a.1000 b.800 c.3000 d.2400 e.900

Anderson Company, a 90% owned subsidiary of Philbin Corporation, transfers inventory to Philbin at a 25% gross profit rate. The following data are available pertaining specifically to Philbin's intra-entity purchases from Anderson. Anderson was acquired on January 1, 2020. 2020 $8,000 2021 $ 12,000 2022 $ 15,000 Purchases by Philbin Ending inventory on Philbin's books 1,200 4,000 3,000 Assume the equity method is used. The following data are available pertaining to Anderson's income and dividends. 2020 $70,000 2021 $ 85,000 2022 $ 94,000 Anderson's net income Dividends paid by Anderson 10,000 10,000 15,000