Dynamics Community Forum Thread Details

Elimination and adjustments while consolidation

I want to have your expertise on a quite complex scenario for Consolidation
and Elimination.

P Co. is parent company to S Co.
Cost of Goods P Co. incurred 100 goods @ 100/- = $ 10,000,
P Co. sells goods to S Co. 50 goods @ 150/- = $ 7500
S Co. Sells 25 Goods @ 200/- = $ 5000/-. S Co. Sells these goods to 3rd
party customer
At Year end 25 goods remains in S Co.'s inventory @ 150/-
Journal Entries:
P Co.
Purchases
        Dr.     Inventory               10000
                Cr.     Accounts Payable                10000
Sales
        Dr.     Accounts Receivable             7500
                Cr.     Sales           7500
Inventory
        Dr.     COGS            5000
                Cr.     Inventory               5000

S Co.
Purchases
        Dr.     Inventory               7500
                Cr.     Accounts Payable                7500
Sales
        Dr.     Accounts Receivable             5000
                Cr.     Sales           5000
Inventory
        Dr.     COGS            3750
                Cr.     Inventory               3750

Elimination Entries
        Dr.     Accounts Payable                 7,500
                Cr.     Accounts Receivable             7500
        Dr.     Sales           7500
                Cr.     COGS            7500
        Dr.     Unrealized profit/COGS          1250
                Cr.     Inventory               1250

   I have separate accounts for Inter company Sales, Inter company Purchases,
Inter company AR, Inter company AP. Challenge is to make the adjustments in
COGS and Inventory. How can I post these eliminations in MR while
consolidation?

Please suggest.

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