JEM owns 30% of MOCK's share capital. During the year to 31 December 2011, MOCK sold inventories at transfer price of $2,000,000 to JEM, of which 40% were still held in inventory of JEM at the year...

JEM owns 30% of MOCK's share capital. During the year to 31 December 2011, MOCK sold inventories at transfer price of $2,000,000 to JEM, of which 40% were still held in inventory of JEM at the year end. MOCK applies a mark-up of 25% on all goods sold. MOCK reported a net profit of $500,000 for year ended 31 December 2011. MOCK is JEM's only associate.

What is share of associate's net profit after tax in JEM's consolidated profit or loss statement for year ended 31 December 2011? PLEASE PROVIDE EXPLANTION.

A) $150,000

B) $102,000

C) $38,000

D) $97,000

E) None of the above.