Investment using the equity method

Assignment Help Accounting Basics

Reference no: EM13132402

Panner, Inc owns 30% of Watkins & applies the equity method. During the current year Panner buys inventory costing 54,000.000 and sells it to Watkins for 90,000.0. At the end of the year Watkins still holds 20,000.00of merchandise. What amount of unrelaized gross profit must Panner defer in reporting this investment using the equity method?

a) $2,400.

b) $4,800.

c) $8,000.

d) $10,800

Reference no: EM13132402

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