Swamp Co,A 55%-Owned Subsidiary of Pond Inc

Multiple Choice

Swamp Co.,a 55%-owned subsidiary of Pond Inc.,made the following entry to record a sale of merchandise to Pond: All Swamp sales are at 125% of cost.One-fourth of this merchandise remained in the Pond's inventory at year-end.A working paper entry to eliminate unrealized profits from consolidated inventory would include a credit to Inventory in the amount of

A) $2,000.
B) $2,500.
C) $8,000.
D) $10,000.