Karlow Corporation owns 60 percent of Draw Companys voting shares. During 20X3, Karlow produced 35,000 computer desks at a cost of $96 each and sold 20,000 of them to Draw for $108 each. Draw sold 12,000 of the desks to unaffiliated companies for $146 each prior to December 31, 20X3, and sold the remainder in early 20X4 for $156 each. Both companies use perpetual inventory systems.

a. What amounts of cost of goods sold did Karlow and Draw record in 20X3?

b. What amount of cost of goods sold must be reported in the consolidated income statement for 20X3?(Do not round intermediate calculations.)

c. Record the consolidation entry for the intercorporate sale of inventory.