Ben Ltd is a wholly owned subsidiary of Bill Ltd . During the year ended 30 June 1985, Bill Ltd sold to Ben Ltd goods, which had originally cost £120000 at a mark-up of 50 per cent on original cost.

At 30 June 1985 closing stock of Ben Ltd included goods acquired from Bill Ltd at a price of £45000. Ben Ltd also owed Bill Ltd £60 000 for goods acquired .

In relation to the reported results of the two individual companies, the Consolidated Financial Statements will require the following adjustments in respect of the above items:

(a) Reduce net profits by £45000 and net assets by £105000;

(b) Reduce net profits by £45000 and net assets by £45000;

(c) Reduce net profits by £ 15000 and net assets by £75000;

(d) Reduce net profit s and net assets by £15000.