Flora Ltd owns all the share capital of Fauna Ltd. For each of the following intragroup transactions, assume that the consolidation process is being undertaken at 30 June 2021, and that an income tax rate of 28% applies. The two transactions are independent.

1. On 1 January 2021, Flora Ltd sold an item of plant to Fauna Ltd for $1,000,000. Immediately before the sale, Flora Ltd had the item of plant on its accounts for $1,500,000. Both Flora Ltd and Fauna Ltd depreciated plants using the straight-line method over 10 years.
2. On 1 May 2021, Fauna Ltd sold inventory costing $200,000 to Flora Ltd for $400,000 on credit. On 30 June 2021, only half of these goods had been sold by Flora Ltd, but Flora Ltd had paid $300,000 back to Fauna Ltd.

Required

1. Prepare the consolidation worksheet adjustment entries for these intra-group transactions.