Patagonia Ltd owns all the share capital of Salto Ltd. The income tax rate is 30%. The following transactions took place during the periods ended 30 June 2018 to 30 June 2020.

(a)In February 2018, Patagonia Ltd sold inventories to Salto Ltd for $6 000, at a mark-up of 20% on cost. One-quarter of this inventories were unsold by Salto Ltd at 30 June 2018 to external parties and none at 30 June 2019.

(b)On 1 January 2018, Salto Ltd sold a new tractor to Patagonia Ltd for $20 000. This had cost Salto Ltd $16 000 on that day. Both entities charged depreciation at the rate of 10% p.a. on the diminishing balance. The tractor was still on hand with Patagonia Ltd at 30June 2020.

(c)On 1 May 2019, Salto Ltd sold inventories costing $200 to Patagonia Ltd for $400 on credit. On 30 June 2019, only half of these goods had been sold by Patagonia Ltd, and Patagonia Ltd had paid $300 to Salto Ltd. All remaining inventories were sold to external entities by 30 June 2020 and Patagonia Ltd paid the outstanding amount to Salto Ltd on 5May 2020.

(d)Patagonia Ltd provided management services to Salto Ltd during the period ended 30June 2020. The total charge for those services was $3 000 that was unpaid at 30June2020.

(e)Patagonia Ltd borrows $50 000 from Salto Ltd on 1 July 2018 with an interest rate of 6% p.a. The loan is for 5 years. The interest is to be paid biannually in arrears, starting on 31December 2018.

(f)In December 2019, Salto Ltd paid a $1 500 interim dividend.

(g)During March 2020, Salto Ltd declared a $3 000 dividend. The dividend was paid in August 2020.

Required:

In relation to the above intragroup transactions:

Prepare adjusting journal entries for the consolidation worksheet at 30 June 2019 and 30June2020.