Problem:
During the current year, ABC Corporation sold inventory costing $80,000 to DEF for $100,000. ABC owns 80 percent of the outstanding shares of DEF Corporation. DEF has paid ABC and DEF still has all of this inventory on the last day of the year. At the balance sheet date, ABC has total current assets of $600,000 whereas DEF has total current assets of $500,000. Assume that there were no allocations established at the date of acquisition.
Required:
Question: What is the total amount reported on the consolidated balance sheet for current assets?
A $1,000,000
B $1,090,000
C $1,080,000
D $1,100,000
Note: Please show how to work it out.