2 Multiple choice type questions

Question 1 Which of the following statements is correct regarding the consolidation adjustments required for intragroup transfer of inventories? Only the effects of intragroup sales of inventories from the parent to the subsidiary needs to be eliminated. Only the effects of intragroup sales of inventories from the subsidiary to the parent needs to be eliminated. Profits earned from selling inventories to external parties need not be eliminated. Only the effects of current-year intragroup sale of inventories need to be eliminated. Profits earned from selling inventories to external parties also need to be eliminated if the inventories sold are acquired from intragroup transactions. Question 2 Henry Ltd, produces cat food using high quality Australian fish, and exports most of its products to the United States. Its most recent reporting period ended on 30 June 2021. At the end of the period it has the following items in its general ledger. Provision for employee benefits (incl. annual leave, long service leave, sick leave...): $500,000. Henry expects one of its five employees to take up their accumulated long service leave in the next year. Lease liability for $25,000 for a car. The lease contract ends 01 January 2022. Lease liability for $ 350,000 for a piece of equipment. The contract ends 30 June 2025. Which of the following statements are correct? 1. The current lease liabilities can be aggregated and reported in a single line item in the statement of financial position. 11. The provision is entirely a non-current liability. The lease liability is entirely a non-current liability. III. a. I and II are true b. I and III are true C. Only 1 is true d. II and III are true None are true e