Mallee Ltd owns 100% of the shares of Fowl Ltd. The following events occurred during the period ended 2020:

(a) Fowl Ltd sold inventory for $15 000 in August 2019. This inventory had been sold to it by Mallee Ltd in June 2019 for $13 500. The inventory had originally cost Mallee Ltd $9000.

(b) On 1 January 2019, Fowl Ltd sold machinery to Mallee Ltd for $150 000. The carrying amount of the machinery at time of sale was $120 000. The machinery is depreciated at 10% p.a. on cost.

Prepare the consolidation worksheet entries for the above two transactions for the preparation of consolidated financial statements at 30 June 2020.

Answer rating: 100% (QA)

To eliminate the effects of the intercompany transactions between Mallee Ltd and Fowl Ltd we need to ... View the full answer