Question: I require urgent help for the following question please help! Rex Ltd owns all the share capital of Paul Ltd. The following transactions relate to

I require urgent help for the following question please help!

Rex Ltd owns all the share capital of Paul Ltd. The following transactions relate to the financial year ended 30 June 2020. The tax rate is 30%.

i)During the year ended 30 June 2020, Paul Ltd sold $200,000 worth of inventory to Rex Ltd. Paul Ltd recorded a $40,000 profit before tax on this transaction. Rex Ltd has one-quarter of the inventory still on hand at the end of the financial year.

ii)On 25 June 2020, Rex Ltd declared a dividend of $40,000. On the same day Paul Ltd declared a $20,000 dividend.

iii)On 1 December 2019, Paul leased surplus office space to Rex, at a rental payment of $18,000 per month. Rent is payable half-yearly in advance, on 1 December and 1 June each year.

Requirement:

Prepare the Consolidation Journal entries for the financial year ended 30 June 2020.

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