Intra-group Transactions REF No. 50 Parent Ltd owns 80% of Subsidiary Ltd. On 1 July 20X1 Subsidiary Ltd sold Plant to Parent Ltd. Details regarding the transaction are as follows: Intracompany sale price $43000 Original cost of plant to Subsidiary Ltd $57000 Accumulated depreciation on Subsidiary's books on date of sale $28500 Plant original useful life Plant remaining useful life at date of sale 5 years Salvage value $0 10 years Tax rate 30% Plant is depreciation on a straight-line basis by both Parent Ltd and Subsidiary Ltd. Round all your answers to the nearest dollar amount. If you believe no journal entry is required, select NULL for the account name, NA for the Dr or Cr, and enter o for the amount. Do not leave the amount blank. Do not enter dollar ($) signs or commas (i.e. enter 10000 not $10,000). Required: 0 Prepare any necessary journal entries in the consolidation journal to adjust for this transaction for the year ended 30 June 20X3. Dr 4350 Plant Cr KEliminate the intra-group gain/loss on the sale) Dr Cr Depreciation expense Adjustment to depreciation expense) Dr Income tax expense Cr Adjustment to tax expense resulting from adjustment to depreciation expense) () Prepare any necessary journal entries in the consolidation journal to adjust the Non-Controlling Interests (NCI) allocation for the year ended 30 June 20x3. INCI Dr Cr (NCI adjustment resulting from elimination of intra-group gain/loss) Dr INCI Cr KNCI adjustment resulting from prior year's depreciation expense adjustment) Dr INCI Cr NCI adjustment resulting from current year's depreciation expense adjustment) Intra-group Transactions REF No. 50 Parent Ltd owns 80% of Subsidiary Ltd. On 1 July 20X1 Subsidiary Ltd sold Plant to Parent Ltd. Details regarding the transaction are as follows: Intracompany sale price $43000 Original cost of plant to Subsidiary Ltd $57000 Accumulated depreciation on Subsidiary's books on date of sale $28500 Plant original useful life Plant remaining useful life at date of sale 5 years Salvage value $0 10 years Tax rate 30% Plant is depreciation on a straight-line basis by both Parent Ltd and Subsidiary Ltd. Round all your answers to the nearest dollar amount. If you believe no journal entry is required, select NULL for the account name, NA for the Dr or Cr, and enter o for the amount. Do not leave the amount blank. Do not enter dollar ($) signs or commas (i.e. enter 10000 not $10,000). Required: 0 Prepare any necessary journal entries in the consolidation journal to adjust for this transaction for the year ended 30 June 20X3. Dr 4350 Plant Cr KEliminate the intra-group gain/loss on the sale) Dr Cr Depreciation expense Adjustment to depreciation expense) Dr Income tax expense Cr Adjustment to tax expense resulting from adjustment to depreciation expense) () Prepare any necessary journal entries in the consolidation journal to adjust the Non-Controlling Interests (NCI) allocation for the year ended 30 June 20x3. INCI Dr Cr (NCI adjustment resulting from elimination of intra-group gain/loss) Dr INCI Cr KNCI adjustment resulting from prior year's depreciation expense adjustment) Dr INCI Cr NCI adjustment resulting from current year's depreciation expense adjustment)
