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A subsidiary entity sold inventory to a parent entity for $30 000. The inventory had previously cost the subsidiary entity $24 000. By reporting date, the parent entity had sold 75% of the inventory to a party outside the group. The company tax rate is 30%. The adjustment entry in the consolidation worksheet at reporting date is:
a. Sales revenueDr 30 000 Cost of salesCr 24 000 InventoryCr 6 000Deferred tax assetDr1 800 Income tax expense Cr 1 800
b. Sales revenueDr 30 000 Cost of salesCr 28 500 InventoryCr 1 500Deferred tax assetDr450 Income tax expense Cr 450
c. Sales revenueDr 22 500 Cost of salesCr 18 000 InventoryCr 4 500Deferred tax assetDr1 350 Income tax expense Cr 1 350
d. Sales revenueDr 7 500 Cost of salesCr 6 000 InventoryCr 1 500Deferred tax assetDr450 Income tax expense Cr 450
e. None of the above

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