Company P holds $70$ percent of the voting shares of Company S$.$ During $20$X$8,$ Company S sold land with a book value of $$125,000$ to Company P for $$150,000.$ Company P continues to hold the land at the end of the year. The companies file separate tax returns and are subject to a $40$ percent tax rate. Assume that Company P uses the fully adjusted equity method in accounting for its investment in Company S$.$

Based on the information given, which consolidating entry relating to the intercorporate sale of land is to be entered in the consolidation worksheet prepared at the end of $20$X$8?$

Event Account tittle Debit Credit

A$)$ Deferred Tax Asset $10,000$

A$)$ Income Tax Expense $10,000$

B$)$ Deferred Tax Asset $25,000$

B$)$ Income Tax Expense $25,000$

C$)$ Deferred Tax Asset $25,000$

C$)$ Land $25,000$

D$)$ No consolidating entry is required.

A$)$ Option A

B$)$ Option B

C$)$ Option C

D$)$ Option D