What would the consolidation journal entry for journal reference ‘i’ have been:
a.
Dr Opening retained earnings
21
Dr Income tax expense
9
Cr Opening inventory (P&L)
30
b.
Dr Opening retained earnings
9
Dr Income tax expense
21
Cr Opening inventory (P&L)
30
c.
Dr Opening inventory (P&L)
30
Dr Income tax expense
9
Cr Opening retained earnings
39
d.
Dr Opening inventory (P&L)
30
Cr Income tax expense
9
Cr Opening retained earnings
21
Consolidation worksheet for financial year ended 30 June 2021 Chandler Joey Adjustments Consolidated Ltd Ltd Debit Ref Credit Entity $'000 $000 $'000 $'000 $'000 Sales revenue 4,620 2,840 530 f 6,930 Less cost of goods sold Opening inventories 680 630 i 30 1,280 Add purchases 3,600 2,120 4 530 5,190 Less closing inventories 710 440 20 g 1,130 Cost of goods sold 3.570 2,310 ? Gross profit 1,050 530 ? Dividend revenue 88 0 88 - Management fee revenue 35 0 35 d Interest revenue 0 9 9 e - Depreciation expense 160 125 I 10 275 Finance costs 181 35 e 9 207 Other expenses 204 49 35 c/d 35 253 Profit before tax 628 330 ? Tax expense 201 97 12 i/g/l 6 304 Profit after tax for the year 427 233 ? Retained earnings 1 July 2020 705 429 337 b/i/l 38 835 Dividends paid 57 (32) i 32 (57 Dividends declared (121) (56) 56 (121) Retained earnings 30 June 2021 954 574 1,208 Issued capital 800 350 350 b 800 Revaluation surplus 210 0 210 Fair value adjustment 56 b/a 56 - Shareholders'equity 1,964 924 ? Assets Cash 78 117 195 Accounts receivable 72 35 h 25 82 Dividends receivable 56 0 k 56 - Inventories 710 440 g 20 1,130 Investment in Joey Ltd 750 0 b 750 - Loan to Chandler Ltd 0 150 e 150 - Land 720 250 80 a 1,050 Buildings 1,500 780 2,280 Accumulated depreciation (320) (494) (814) Plant and equipment 850 450 25 1,325 Accumulated depreciation (235) (210) 30 85 (500) Goodwill (net) 94 b/c 35 59 Deferred tax asset 24 g/l 9 15 Total assets 4,181 1,518 4,822 Less liabilities Current taxes payable 111 87 198 Accounts payable 292 50 25 h 317 Dividend payable 121 56 56 k 121 Loan from Joey Ltd 150 0 150 e - Mortgage loan 1,253 401 1,654 Deferred tax liabilities 290 0 a 24 314 Net assets 1,964 924 1,956.00 1,956.00 ?
