Question

Willard Corporation regularly sells inventory items to its subsidiary, Petty, Inc. If unrealized profits in Petty's 20X1 year-end inventory exceed the unrealized profits in its 20X2 year-end inventory, 20X2 combined

a. cost of sales will be less than consolidated cost of slaes in 20X2

b. gross profit will be greater than consolidated gross profit in 20X2

c. sales will be less than consolidated sales in 20X2

d. cost of sales will e greater than consolidated cost of sales in 20X2