Answer:
                                 Journal entries
Date           Particulars                                    Debit         Credit
31, Dec 19  Investment in Branch Office     $132,000
                          To Inventories                                         $110,000
                          To Allowance for Overvaluation of        $20,000
                          Inventories
31, Dec 19    Profit and loss                          $18,400
                            To Investment in Branch Office            $18,400
31, Dec 19     Allowance for Overvaluation   $10,000 
                      of Inventories
                            To Realized Gross Profit: Branch Sales  $10,000
Workings
1. Unrealized Inter-company Inventory Profit = (132,000/120) * 20 = $22,000
Shipment to Branch = 132,000 - 22,000 = $110,000
2. Unrealized Inter-company Inventory Profit = (60,000/120) * 2 = $10,000