Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Adam Ltd owns all of the share capital of Getty Ltd. The income tax rate is 30%. The following transactions took place during the periods

image text in transcribed

Adam Ltd owns all of the share capital of Getty Ltd. The income tax rate is 30%. The following transactions took place during the periods ended 30 June 2019 or 30 June 2020. (a) In January 2020. Adam Ltd sells inventories to Getty Ltd for $10 000 in cash. These inventories had previously cost Adam Ltd $5.000 and remain unsold by Getty Ltd at the end of the period. (b) In February 2020. Adam Ltd sells inventories to Getty Ltd for $18 000 in cash. These inventories had previously cost Adam Ltd $10.000 and are on-sold externally on 2 April 2020. (c) In February 2020, Getty Ltd sells inventories to Adam Ltd for $20 000 in cash (original cost to Getty Ltd was $15 000) and half are on-sold externally by 30 June 2020. d) In March 2020. Adam Ltd sold inventories for $1 000 to Zara Ltd, an external entity. These inventories were transferred from Getty Ltd on 1 June 2019. The inventories had originally cost Getty Ltd $600 and were sold to Adam Ltd for $1 200. (2) In June 2020, Getty Ltd sells inventories to Adam Ltd for $12 000 in cash. These inventories had previously cost Getty Ltd $6.000 and are on-sold externally on 30 June 2020 for $15 000 Required In relation to the above intragroup transactions, prepare adjusting journal entries for the consolidation worksheet at 30 June 2020. Only the adjusting entries need be shown. Narrations are not required. Journal for the answer to Question 2 - expand the table if needed to contain your answer. Date Account Dr Cr

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Continuous Auditing A Complete Guide

Authors: Gerardus Blokdyk

2019th Edition

0655540318, 978-0655540311

More Books

Students also viewed these Accounting questions