Possum Ltd owns all of the shares of Kingfisher 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 2020. Assume an income tax rate of 30%.

Part A

In the 2019-20 period, Kingfisher Ltd sold inventory to Possum Ltd. Total sales were $100,000, these being sold at cost plus 25%. At 30 June 2020, Possum Ltd still held inventory that it had bought from Kingfisher Ltd for $40,000.(4 marks)

Possum Ltd owns all of the shares of Kingfisher 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 2020. Assume an income tax rate of 30%.

Part B

On 1 January 2019, Kingfisher Ltd sold the Machinery to Possum Ltd for $200 000. At the date of sale, Kingfisher Ltd had recorded a carrying amount of $160,000. Possum Ltd charged depreciation at the rate of 10% p.a. on this item.(5 marks)

Possum Ltd owns all of the shares of Kingfisher 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 2020. Assume an income tax rate of 30%.

Part C

On 1 May 2019, Possum Ltd sold inventory to Kingfisher Ltd for $66,000, recording a before-tax profit of $14000. All this inventory acquired from possum ltd remained on hand at 30 June 2019. During January 2020, Kingfisher Ltd sold all of this inventory to external entities for $100,000.(2 marks)

Possum Ltd owns all of the shares of Kingfisher 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 2020. Assume an income tax rate of 30%.

Part D

On 1 January 2020, Possum Ltd acquired $100000 of debentures previously issued by Kingfisher Ltd. These were acquired on the open market for $100,000. The Half-yearly Interest of $3,600 on debentures was paid on 30 June 2020.(2 Marks)

Possum Ltd owns all of the shares of Kingfisher 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 2020. Assume an income tax rate of 30%.

Part D

During the period ended 30 June 2020, Kingfisher Ltd offered Accounting and Consulting services to Possum Ltd. Possum Ltd in return paid $15000 for the services offered by Kingfisher Ltd.(1 Marks)