Consider consolidation adjustments for intra-group transactions in more detail, profit on merchandise sales was 80%* for Parts Palace and 90%* for Smashed for all sales transactions including inter-group transactions (* = as a percentage of sales)

provide a spreadsheet showing the consolidation adjustments in journal form only for the following intra-group transactions during 2019 (all figures below are in $000s):

1. Parts Palace sold Smashed merchandise at a price of $150.

2. Smashed sold Parts Palace merchandise at a price of $250.

3. $35 remained owing by Parts Palace at 31 December 2019 for the merchandise sold to it by Smashed.

4. Parts Palaces inventories included merchandise bought from Smashed of: a. $20 at the beginning of 2019, and b. $30 at the end of 2019.

5. Smasheds 2019 inventories included merchandise bought from Parts Palace of: a. Beginning: $20, and b. Closing: $15.

6. The Other non-current assets on Parts Palaces balance sheet includes a long-term loan to Smashed of $800.

7. The terms of the loan to Smashed require 9% annual interest payments. The loan was made on 1 January 2019 and interest is paid on 31 December each year.

Prepare the consolidation journal entries only for the above intragroup transactions for the year ended 31 December 2019.

a) Choose the most appropriate accounts to which to post each journal adjustment.

b) Post a separate numbered journal entry for each numbered piece of information above i.e., journal entries should be posted to the corresponding columns for the above numbers 1 7. For example, post a separate journal entry (Dr and Cr) for #3 and a separate journal entry (Dr and Cr) for #4a.