Thomas Ltd owns 100% of the shares of Uncle Ltd with acquisition date being 1 July 2019. During the year ending 30 June 2020 Uncle Ltd sold inventory to Thomas Ltd for $100 000. The inventory cost Uncle Ltd $60 000 to produce. At 30 June 2020, 40% the inventory remains unsold in the books of Thomas Ltd. The tax rate is 30%. Both Thomas Ltd and Uncle Ltd adopt the perpetual method of accounting for inventory.

Required (10 marks)

Prepare the consolidation journal entries to account for the above for the year ending 30 June 2020.