The Journal Entries to Eliminate Unrealised Profit in Closing Inventory

Multiple Choice

The journal entries to eliminate unrealised profit in closing inventory at 30 June 2014 were as follows: $$\begin{array} { | l | r | r | } \hline 30 \text { June } 2014 & & \\\hline \text { Dr Cost of goods sold } & 50000 & \\\hline \text { Cr lnventory } & & 50000 \\\hline & & \\\hline \text { Dr Deferred tax asset } & 15000 & \\\hline \text { Cr Income tax expense } & & 15000 \\\hline\end{array}$$ What are the journal entries to eliminate the unrealised profits in opening inventory the following period?

A) $\begin{array}{|l|r|l|}\hline 1 \text { July } 2014 & & \\\hline \text { Dr Cost of goods sold } & 50000 & \\\hline \text { Cr Inventory } & & 50000 \\\hline & & \\\hline \text { Dr Deferred tax asset } & 15000 & \\\hline \text { Cr Income tax expense } & & 15000 \\\hline\end{array}$
B) $\begin{array}{|l|r|l|}\hline 1 \text { July } 2014 & & \\\hline \text { Dr Opening retained earnings (1 July 2014) } & 50000 & \\\hline \text { Cr Cost of goods sold } & & 50000 \\\hline & & \\\hline \text { Dr Deferred tax asset } & 15000 & \\\hline \text { Cr Opening retained earnings (1 July 2014) } & & 15000 \\\hline\end{array}$
C) $$\begin{array} { | l | r | r | } \hline \text { 1 July } 2014 & & \\\hline \text { Dr Opening retained earnings (1 July 2014) } & 50000 & \\\hline \text { Cr lnventory } & & 50000 \\\hline & & \\\hline \text { Dr Deferred tax asset } & 15000 & \\\hline \text { Dr Opening retained earnings (1 July 2014) } & & 15000 \\\hline\end{array}$$
D) $$\begin{array} { | l | r | r | } \hline \text { 1 July } 2014 & & \\\hline \text { Dr Opening retained earnings (1 July 2014) } & 50000 & \\\hline \text { Cr Cost of goods sold } & & 50000 \\\hline \\\hline \text { Dr Income tax expense } & 15000 \\\hline \text { Cr Opening retained earnings (1 July 2014) } && 15000 \\\hline\end{array}$$