1. Pancy Incorporated sold $310,000 of its inventory to Seid Company during 2020 for $450,000. Seid sold $324,000 of this merchandise in 2020 with the remainder to be disposed of during 202 Assume Pancy owns 40% of Reid and accounts for its investment using the equity method.

What journal entry will be recorded at the end of 2020 to defer the recognition of the investors share of the intra-entity gross profits