A subsidiary sold inventories to its parent for $50 000. The inventories originally cost the subsidiary $38
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Question:
A subsidiary sold inventories to its parent for $50 000. The inventories originally cost the subsidiary $38 000. At balance sheet date, the parent had sold 50% of the inventories to an external party. The company tax rate is 30%. Which of the following is the deferred tax item that is recognised on consolidation?
Dr Deferred tax asset $3600 | ||
Cr Deferred tax liability $3600 | ||
Cr Deferred tax liability $1800 | ||
Dr Deferred tax asset $1800 |
Related Book For
Advanced Accounting
ISBN: 978-1934319307
2nd edition
Authors: Susan S. Hamlen, Ronald J. Huefner, James A. Largay III
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