PAR owns 80% of SUB common stock. During October 2016, PAR sold merchandise to SUB for $500,000. On December 31, 2016, one-half of this merchandise remained in SUB's inventory. For 2016, gross profit percentages were 30% for PAR and 40% for SUB. The amount of unrealized profit in the ending inventory on December 31, 2016, should be eliminated in consolidation is:

PAR owns 80% of SUB common stock. During October 2016, PAR sold merchandise to SUB for $500,000. On December 31, 2016, one-half of this merchandise remained in SUB's inventory. For 2016, gross profit percentages were 30% for PAR and 40% for SUB. The amount of unrealized profit in the ending inventory on December 31, 2016, should be eliminated in consolidation is:

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter22: Accounting For Changes And Errors.

Section: Chapter Questions

Problem 2P

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