Prepare the consolidated journal entries

Assignment Help Accounting Basics
Reference no: EM133113384

Question - The following intragroup transactions between Max Ltd and Mini Ltd occurred during the financial year ended 30 June 2021:

Mini Ltd sold inventory which had an original cost of $220,000 to Max Ltd. Mini Ltd had recorded a $120,000 profit before tax on this transaction. Max Ltd still had one third of this inventory on hand as at 30 June 2021.

On 1 July 2020, Max Ltd sold a motor vehicle to Mini Ltd for $30,000. The cost and accumulated depreciation of the motor vehicle at the date of sale were $50,000 and $30,000 respectively. The motor vehicle is assessed as having a remaining usefullife of five years from the date of sale and zero residual value at the end of the useful life.

Required -

a) Prepare the consolidated journal entries for the above intragroup transactions as at 30 June 2021. Assume an income tax rate of 30%.

b) Provide necessary justifications for recording consolidated journal entries for intragroup transactions (i) and (ii).

Reference no: EM133113384

Questions Cloud

Prepare appropriate journal entries relative to accounts : Burns estimates that bad debt losses will be 1.5% of credit sales. Prepare all appropriate journal entries relative to uncollectible accounts
Calculate the original loan size of a fixed-payment mortgage : Calculate the original loan size of a fixed-payment mortgage if the monthly payment is $1,146.78, the annual interest rate is 8.0%
Managerial economics-project future performance : One of the most important uses of these statements is to evaluate past performance and project future performance.
Compute how many units of the item were traded : What simplifying assumptions are made? How does computational thinking help us analyze this particular situation - Compute how many units of the item were trade
Prepare the consolidated journal entries : Prepare the consolidated journal entries for the above intragroup transactions as at 30 June 2021. Assume an income tax rate of 30%
Find the annual effective rate of interest governing account : Marianne deposits $2,000 in a five-year certificate of deposit. At maturity, the balance is $2,580.64. Find annual effective rate of interest governing account
About your experience with risk management : Your boss has asked you to speak at the quarterly board meeting about your experience with risk management.
Record sales transactions and related taxes for each client : On April 27, the company collected $27,100 sales in cash plus sales taxes. Record sales transactions and related taxes for each client
Describe the production process : Describe the production process (how you will produce the product) or describe how your business will operate if retail or service company.

Reviews

Write a Review

Accounting Basics Questions & Answers

  Why would your boss be concerned about this issue

What kinds of conflicts can arise by having "shareholder maximization" as the primary goal of a firm? Do you believe that firms should have a different "objective"? Please explain.

  The following information pertains to crystal incs

the following information pertains to crystal inc.s portfolio of investments for the year ended december 31 2010

  What is the labor efficiency variance

The job was completed in 570 hours and the average actual labor rate was $19.80 per hour. What is the labor efficiency (quantity) variance

  Consider national bank you are familiar with

For the bank you selected, scan the Internet for articles or evidence of the bank being a victim of hacking. Based on the results of your search

  Discuss what is the fixed overhead spending variance

During July, 9,400 units were produced and $142,800 was spent on fixed overhead. What is the fixed overhead spending variance

  What is company small business deduction for the taxation

Taxable capital employed in Canada in 2019 was$11.9 million. What is the company's Small Business Deduction for the taxation year 2020

  Give examples from the iasb on the globalization activities

What is IASB? give a brief overview of and examples from the IASB on its globalization activities that culminated in the adoption of IFRS in Australia.

  Should finch company make or buy the part

An outside supplier has offered to sell the company all of these parts it needs for $56.00 a unit. Should Finch Company make or buy the part

  Calculate the amount of amortization expense for the year

Calculate the amount of amortization expense for the year ended December 31, 2001, using the double declining balance method of amortization

  Calculate the total cost of direct materials used

avery corporations northwestern factory provided the followinginformation for the last calendar yearbeginning

  What are the major objectives of a budget system

FNSACC503 - Manage budgets and forecasts - How frequently should the budget review occur? Under what conditions is this different and when will the review occur

  Make the present value of the expected overall savings

ABC Hospital, Make the present value of the expected overall savings in operating costs during the four years if the machine is purchased.

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd