On October $31,2023,$ Snake, a wholly$-$owned subsidary of Pelican $($Parencl$.$ sold inventory to Pelican for a cash salies price of $$120,000.$ Snabe's inventory cost was $$100,000.$ As of December $31,2023.$ Petican gnt held all of the invertary they had acquired from Snake, in early $2024,$ Pelican sold the invertory to an unaffilated party for $$120,000.$ The best description of the proper intercompany accounting for this transaction in Pelican's $2023$ consoldated financial statements would be

eliminate the $$120,000$ sale, but recognize the $$20,000$ gross profic, because it was an upstream transaction

recognize the $$120,000$ sale and recognive the $$20,000$ fross preft, because the $$120\mathrm{.}000$ intercompany luies price is sutriantially equivalent to a sale to an outwide party $($fe$.$ as$-$if an armis lengh transaction$)$

recognize the $$120\mathrm{.}000$ sale, but defer the $120,000$ gross profit

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