Ltd Consolidated Entity $'000 5,430 601 3,684 664 2 ? Consolidation worksheet for financial year ended 30 June 2021 Joey Chandler Adjustments Ltd Debit Ref Credit $'000 $'000 $'000 $ '000 Sales revenue 4,360 1,570 500 1 Less cost of goods sold Opening inventories 375 256 i 30 Add purchases 3,080 1,104 1 500 Less closing inventories 425 279 40 g Cost of goods sold 3.030 1,081 Gross profit 1,330 489 Dividend revenue 70 0 70 i Management fee revenue 25 0 25 d Interest revenue 0 15 15 e Depreciation expense 245 187 ! 20 Finance costs 105 15 Other expenses 325 79 20 c/d 25 Profit before tax 750 140 Tax expense 265 45 15.00 i/g/ 12.00 Profit after tax for the year 485 95 Retained earnings 1 July 849 394 233 64 2020 Dividends paid (53) (28) 28 Dividends declared (107) (42) 42 Retained earnings 30 June 1,174 419 2021 Issued capital 750 400 400 b Revaluation surplus 190 0 Fair value adjustment 84 b/a Shareholders' equity 2,114 819 Assets 98 e 412 188 399 ? 313 ? 1,074 bil (53) (107) 1,411 750 190 84 ? 190 173 170 109 360 242 Cash Accounts receivable Dividends receivable Inventories Investment in Chandler h k 42 40 42 40 640 0 279 0 425 664 g b 640 Ltd 0 e 250 120 a 1,099 1,440 (475) 250 450 968 (525) 1,669 2,408 (1,000) 690 1 1,025 (275) 10 60 1,725 (595) (290) 90 36 20 16 Loan to Joey Ltd Land Buildings Accumulated depreciation Plant and equipment Accumulated depreciation Goodwill (net) Deferred tax asset Total assets Less liabilities Current taxes payable Accounts payable Dividend payable Loan from Chandler Ltd Mortgage loan Deferred tax liabilities Net assets b/c g 36.00 18.00 35 4,319 25 2,126 78 5,567 87 40 h 198 302 107 k 111 292 107 250 1,255 190 50 42 0 1,100 28 42 250 e 2,355 254 a 36 2,114 819 1,996.00 1,996.00 ? What is the most likely explanation for the credit amount of $64 against the account Opening retained earnings 1 July 2020? a. Tax effects of a prior year unrealised profit on sale of plant and equipment and subsequent adjustment to prior year depreciation expenses. b. Tax effects of a prior year unrealised profit on sale of plant and equipment and subsequent adjustment to current year depreciation expenses. Opening inventory adjustment and elimination of a prior year unrealised profit on sale of plant and equipment d. Tax effects of opening inventory adjustment and elimination of a prior year unrealised profit on sale of plant and equipment