1. Red Ltd owns 100% of the share capital and is the parent company of Blue Ltd. The company tax rate is 30%. Blue Ltd declared a final dividend of $25,000 out of the current year's operation profit. The dividend will be paid in the following period. Red Ltd. records income when it is declared.

Required: Prepare the necessary consolidation entries.

2. Red Ltd sold equipment to Blue Ltd for $190 000. It had a carrying amount in the books of Red Ltd at the time of sale of $165 000. Depreciation charged on equipment by Red Ltd is 10% on cost however, Blue Ltd applies a rate of 5% on cost.

Required: Prepare the necessary consolidation entries. Show workings in narrations.

3. On July 1 2023, Red Ltd lends Blue Ltd $800 000, charging 6% interest per annum.

Required: prepare the necessary consolidation entries at 30 June 2024.