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French Ltd owns 100 per cent of the issued capital of Pastry Ltd. During the period ended 30 June 2024, Pastry Ltd sold inventory that
French Ltd owns 100 per cent of the issued capital of Pastry Ltd.
During the period ended 30 June 2024, Pastry Ltd sold inventory that cost $190 000 for $300 000 to French Ltd.
Sixty per cent of this inventory remains on hand in French Ltd at the end of that year.
Both companies use a perpetual inventory system and the taxation rate is 30 per cent.
What consolidation journal entries are required in relation to the inter-company transaction for the period ending 30 June 2025 in which all such unsold inventory has been sold to external parties?
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