1) The following intercompany transactions occurred during the year:

a) Parent loaned $ _____ to Subsidiary. To keep things simple, assume that there is no interest revenue or interest expense associated with this loan.

b) Parent made a sale to Subsidiary for $ ______ cash. The inventory had originally cost Parent $ ____. Subsidiary then sold that same inventory to an outsider for $ _______.

c) Parent made a sale to Subsidiary for $_____ cash. The inventory had originally cost Parent $____. Subsidiary has not yet sold that same inventory to an outsider.

What consolidation worksheet entries would you make?

Note: Assume you own figures wherever required.