On January 1st 2000 ABC Company acquired 100% of the voting stock of Zeta Company at book value. ABC uses the initial value method (cost) and Zeta doesn't pay any dividends.

On October 1st 2020 ABC sold some merchandise (inventory) to Zeta company for $1,000,000 credit. the inventory had cost Zeta $600,000. Both Zeta and ABC use the perpetual inventory method. During 2020 Zeta had sold 70% of the merchandise acquired from ABC for $750,000 but had not paid off ABC. During 2021 Zeta sold the remaining merchandise for $325,000 and paid off ABC.

In 2020 ABC (unconsolidated) reported income of $1,000,000 and Zeta reported income of $40,000.

In 2021 ABC (unconsolidated) reported income of $1,200,000 and Zeta reported income of $77,000.

A) Make ABC's journal entry when it sells the merchandise to Zeta in 2020

B) Make Zeta's journal entry when it buys the merchandise from ABC in 2020

C) Make any necessary worksheet entries in 2020.

D) Determine consolidated income for 2020.

E) Make any necessary worksheet entries in 2021

F) Make any necessary worksheet entries in 2021

G) Determine consolidated income for 2021