on January 1 2013,Harrison Company holds 80% of Burke Company stock. In the current year Harrison reports sales of $800,000 and cost of goods sold $600,000. For the same period, Burke has sales of $400,000 and cost of goods sold of $280,000. In the prior year, Harrison sold inventory to Burke for $100,000, which cost Harrison $75,000. Burke had $20,000 of this inventory on hand at year end. During the current year, Harrison sold inventory to Burke for $120,000, which cost Harrison $96,000. At year end Burke possesses 40% of the inventory. Harrison had established the transfer price on its normal gross profit rate.

Required:

Prepare the consolidation entries necessitated by the intra-company sales.