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KK purchased 100% of the equity shares in WX on 1 October 2012. KK and WX trade with each other. During the year ended 30 September 2013 KK sold WX inventory at a sales price of R28,000. KK applied a mark up on cost of 13%.
At 30 September 2013 WX still owed KK R 10,000 of the cost and had remaining in inventory R6,000 of the goods purchased from KK.
Required:
Question 1: Prepare the journal entries to make the required adjustment in KK's consolidated financial statements for the year ended 30 September 2013 for the above.
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