How should sale between lawler and ritter be accounted

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Reference no: EM13136657

McGraw Corp. owned all of the voting common stock of both Ritter Co. and Lawler Co. during 2011, Ritter sold inventory to Lawler. The goods had cost Ritter $65,000, and they were sold to Lawler for $100,000. At the end of 2011, Lawler still held 30% of the inventory.

Required:

How should the sale between Lawler and Ritter be accounted for in a consolidation worksheet? Show worksheet entries to support your answer.

Reference no: EM13136657

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