3 minutes 14 seconds Question Completion Status Question 5 You have a peer graded assignment in Advanced Accounting course where students are required to review and grade each other amignments You are to review your colleague Khalid's paper. The following information is provided by Khalid 1- Intra-entity transactions involving transfer of inventory between affiliated companies in a business combination can be downstream or upstream. In these transactions, inventories can be transferred at historical cost or at a markup The gross profit resulting from such transfer are immediately realized in the year of the transfer 2-A downstroam transfer involves sale of inventory by the parent company to its subsidiary of the subsidiary is 100% owned as the resultare gross profit is solely related to the parent company. However if the subsidiary is partially owned the gross proft would be allocated between the parent company and the noncontrolling interest in proportion of their ownership interest. 3-Consolidated financial statements are prepared to provide one sot of financial statements reflecting the parent and subsidiary on cring economic entity. As such any intra-entity transactions are eliminated. Intra-entity transfer of inventory is an internal transaction that requires the removal of intra-entity sales and purchases in the process whether the transfer is downstream or upstream However, if the transfers downstream and the subsidiary is partially owned, the parent as the sole recognizes all the resultant gross profitienpective of any inventory on hand at year ond, immediately in the year of transfer. 4-11 a portion of the intra-entity transfer remains in ending inventory in any your gross profit in that invertory is subtracted from consolidated cost of goods sold. Required: Identify any wrong information provided by Khalid in each of the above paragraphs and give the right information For the toolbar.press ALTFOR ALTINFO IE 12 TXO