On 1 July 2020 P Ltd purchased 100% of the issued capital of S Ltd for a purchase price of $840,000. At that date, the shareholders’ equity of S Ltd disclosed: 

Share capital $122,000 

General reserve of $108,000 

Retained earnings of $234,000 

Additional information: 

At the date of acquisition, all net identifiable assets of Sub Ltd were recorded at fair value Sales by S to P Ltd were $60,000. P Ltd sold inventory of $114,000 to S Ltd on 1 July 2021. The original cost of this inventory to P Ltd was $50,000. S Ltd has 47% of this inventory on hand at 30 June 2022 4. Company tax rate is 30% The consolidation journal entries (partial) are listed below: 

30 June 2022 

Share capital $122,000 

General reserve $108,000 

Retained earnings $234,000 

Goodwill $376,000 I

nvestment in S $840,000 

Sales Revenue $60,000 

Purchases $60,000 

Sales revenue $114,000 

Cost of goods sold $ xxx Inventory Deferred tax asset Income tax exp Enter the amount of xxx in the answer space below:

Answer:____________________________.

Answer rating: 100% (QA)

The cost of goods sold for P Ltd is calculated by subtracting ... View the full answer