Q.N.16 Pfizer Ltd owns all of the shares of Biotech 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 2021. Assume an income tax rate of 30%.

Part A

In the 2020-21 period, Biotech Ltd sold inventory to Pfizer Ltd. Total sales were $200,000, these being sold at cost plus 25%. At 30 June 2020, Pfizer Ltd still held 50% of the inventory that it had bought from Biotech Ltd. (2 marks)