What amount of intra-entity gross profit would be deferred

Reference no: EM133542073

Question: On January 2, 2021, London Inc. acquired 80% of the voting common stock of Barcelona Co. During the year, London sold to Barcelona $315,000 goods that cost $210,000. At year-end, Barcelona owned 30% of the goods transferred. Barcelona reported a net income of $305,000, and London's net income was $986,000. London decided to use the equity method to account for this investment. What amount of intra-entity gross profit would be deferred in 2021? Group of answer choices $21,000. $25,200. $31,500. $84,000. $105,000.

Reference no: EM133542073

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