On 16 May 2021, Zebra Ltd sold an equipment to its subsidiary Nando Ltd for $100,000, this asset having a carrying amount at time of sale of $110,000. The equipment was regarded by Zebra Ltd as a depreciable non-current asset, being depreciated at 10% p.a. on cost, whereas Nando Ltd records the equipment as inventory. The asset was sold to external party by Nando Ltd before 30 June 2021. The worksheet entry for the year ended 30 June 2021 would include which of the following adjustments? Tax rate is 30%.
On 16 May 2021, Zebra Ltd sold an equipment to its subsidiary Nando Ltd for $100,000, this asset having a carrying amount at time of sale of $110,000. The equipment was regarded by Zebra Ltd as a depreciable non-current asset, being depreciated at 10% p.a. on cost, whereas Nando Ltd records the equipment as inventory. The asset was sold to external party by Nando Ltd before 30 June 2021. The worksheet entry for the year ended 30 June 2021 would include which of the following adjustments? Tax rate is 30%.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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B1.
Transcribed Image Text:On 16 May 2021, Zebra Ltd sold an equipment to its subsidiary Nando Ltd for
$100,000, this asset having a carrying amount at time of sale of $110,000. The
equipment was regarded by Zebra Ltd as a depreciable non-current asset, being
depreciated at 10% p.a. on cost, whereas Nando Ltd records the equipment as
inventory. The asset was sold to external party by Nando Ltd before 30 June 2021.
The worksheet entry for the year ended 30 June 2021 would include which of the
following adjustments? Tax rate is 30%.
Select one:
Ⓒa. Cr Cost of sales 110 000
O b.
Dr Cost of sales 10 000
O c.
O d. Dr Inventory 10,000
Clear my choice
Cr Cost of sales 10,000
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