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Precious Inc. owns 80% of the outstanding voting common stock of Soul Co.. Previously in 2014, Soul had sold inventory costing $28,800 to Precious for $48,000. All but 25% of this merchandise was consumed by Precious during 2014. The remainder was used during the first few weeks of 2015. In 2015, Soul had sold inventory costing $33,600 to Precious for $60,000. Of this total, 40% was not consumed until 2016. What net amount of gross profits would Precious have deferred in 2015 related to Soul's sale of inventory to Precious?

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Accounting Basics, Accounting

Category:- Accounting Basics
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