Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Part B [15 marks] Yadra Ltd owns all of the share capital of Viti Ltd. In relation to the following intragroup transactions, all parts of

image text in transcribed

Part B [15 marks] Yadra Ltd owns all of the share capital of Viti Ltd. In relation to the following intragroup transactions, all parts of which are independent unless specified, prepare the consolidation worksheet adjusting entries for preparation of the consolidated financial statements as at 30 June 2016. Assume an income tax rate of 30%. (a) During the year ending 30 June 2016, Viti Ltd sold $55 000 worth of inventory to Yadra Ltd. Viti Ltd recorded an $8000 profit before tax on these transactions. At 30 June 2016, Yadra Ltd has one-quarter of these goods still on hand. (b) Yadra Ltd manufactures items of machinery which are used as property, plant and equipment by other companies, including Viti Ltd. On 1 January 2016, Yadra Ltd sold such an item to Viti Ltd for $52 000, its cost to Yadra Ltd being only $45 000 to manufacture. Viti Ltd charges depreciation on these machines at 20% p.a. on the diminishing balance. (c) A non-current asset with a carrying amount of $1200 was sold by Viti Ltd to Yadra Ltd for $900 on 1 January 2016. Yadra Ltd intended to use this item as inventory, being a seller of second-hand goods. Both entities charged depreciation at the rate of 10% p.a. on the diminishing balance on non-current assets. The item was still on hand at 30 June 2016. (d) Yadra Ltd issued 1000 10% debentures of $100 at nominal value on 1 October 2015. Viti Ltd acquired 300 of these. Interest is payable half-yearly on 31 March and 30 September. Accruals have been recognised in the legal entities' accounts. (e) On 25 June 2016, Yadra Ltd declared a dividend of $8000. On the same day, Viti Ltd declared a $4000 dividend

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Financial Accounting An Introduction To Concepts Methods And Uses

Authors: Clyde P. Stickney, Roman L. Weil

12th Edition

0324381980, 978-0324381986

More Books

Students also viewed these Accounting questions

Question

Date the application was sent

Answered: 1 week ago

Question

Explain the need for and importance of co-ordination?

Answered: 1 week ago

Question

Explain the contribution of Peter F. Drucker to Management .

Answered: 1 week ago

Question

What is meant by organisational theory ?

Answered: 1 week ago

Question

What is meant by decentralisation of authority ?

Answered: 1 week ago

Question

Summarise the scope of HRM and the key HRM functions

Answered: 1 week ago