How the 30% is derived, and what are the numbers that calculate the intra-entity deferred gross profit? I am looking for a professional memo addressed to me stating your response!

Example Problem Journal Entries: Intra Entity Asset Transactions

INTRA-ENTITY GROSS PROFIT, 12/31/17 Intra-entity gross profit ($200,000 $160,000) ................................ $40,000

Inventory remaining at year's end ...................................................... 18%

Intra-entity intra-entity gross profit, 12/31/17 .................................. $ 7,200

INTRA-ENTITY GROSS PROFIT, 12/31/18 Intra-entity gross profit ($350,000 $297,500) ................................ $52,500

Inventory remaining at year's end ...................................................... 30%

Intra-entity gross profit in inventory, 12/31/18 ................................ $15,750

CONSOLIDATED COST OF GOODS SOLD

Parent balance ................................................................................... $607,500

Subsidiary balance ........................................................................... 450,000

Remove intra-entity transfer .......................................................... (350,000)

Recognize 2017 deferred gross profit ......................................... (7,200)

Defer 2018 intra-entity gross profit .............................................. 15,750

Cost of goods sold .................................................................................. $716,050