Alpha Company owns 80 percent of the voting stock of Beta Company. Alpha and Beta reported the following account information from their year-end separate financial records:

	Alpha	Beta
Inventory	$95,000	$88,000
Sales Revenue	800,000	300,000
Cost of Goods Sold	600,000	180,000

During the current year, Alpha sold inventory to Beta for $100,000. As of year end, Beta had resold only 60 percent of these intra-entity purchases. Alpha sells inventory to Beta at the same markup it uses for all of its customers.

Problem 5-6 (Static) (LO 5-2, 5-3)

What is the total for consolidated cost of goods sold?

Multiple Choice

• $790,000

• $690,000

• $788,000

• $670,000