This question is all about "understanding"!!

P Ltd is the parent of S Ltd. On 1 January 2021 P sold inventory to S for $23,000. The profit margin on this inventory was $7,000. On 1 May 2021, as a result of impairment testing, S was forced to write down the inventory to $9,000. As of end of financial year, June 30, S still held all of this inventory.

Below shows consolidation elimination entries for June 30, 2021

30 June 2021
Sales		$23,000
	Cost of sales		$23,000
Cost of sales		$ xxx
	Impairment expense -inventory		$ xxx

Explanations: the first entry removes the gross amount of sales. Since S has already removed $14,000 from the inventory no further reductions to inventory are necessary. From the group viewpoint impairment expense should be based on a reduction from the original cost, $16,000, so only $7,000 of impairment expense is necessary to take the inventory back to $9,000. The second entry therefore reclassifies unnecessary impairment expense, recorded by S, back to its cost of sales. Noted that the difference of impairment expense from S and from the group's perspective. The latter entry treats the $7,000 as a deletion of mark-up from inventory rather than as an impairment expense

Requirement: Enter the amount of xxx in the answer space below