S Ltd(a partially owned subsidiary), sold inventories for the first time to its parent, P ltd during the reporting period ended28 February 2015, at a profit mark up of 25% on cost price. On 28 February 2015 inventories to the value of R100 000 (atcost to P Ltd) were still on hand. The company tax rate is 28%. Total sales from S Ltd to P Ltd for the current reportingperiod amounted to R200 000. What are the correct journal entries for elimination of intragroup sales? Select one: a. Dr Cost of sales R200 000(P), Cr Revenue(S) P/L R200 000 b. Dr Revenue(S) (P/L) R200 000, Cr Cost of sales(P) R200 000 c. Dr Revenue(S)P/L R100 000, Cr Cost of sales(P) R100 000 d. Dr Revenue(P) P/L R200 000 Cr Cost of sales(P)R200 000
S Ltd(a partially owned subsidiary), sold inventories for the first time to its parent, P ltd during the reporting period ended28 February 2015, at a profit mark up of 25% on cost price. On 28 February 2015 inventories to the value of R100 000 (atcost to P Ltd) were still on hand. The company tax rate is 28%. Total sales from S Ltd to P Ltd for the current reportingperiod amounted to R200 000. What are the correct journal entries for elimination of intragroup sales? Select one: a. Dr Cost of sales R200 000(P), Cr Revenue(S) P/L R200 000 b. Dr Revenue(S) (P/L) R200 000, Cr Cost of sales(P) R200 000 c. Dr Revenue(S)P/L R100 000, Cr Cost of sales(P) R100 000 d. Dr Revenue(P) P/L R200 000 Cr Cost of sales(P)R200 000
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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S Ltd(a partially owned subsidiary), sold inventories for the first time to its parent, P ltd during the reporting period ended28 February 2015, at a profit mark up of 25% on cost price. On 28 February 2015 inventories to the value of R100 000 (atcost to P Ltd) were still on hand. The company tax rate is 28%. Total sales from S Ltd to P Ltd for the current reportingperiod amounted to R200 000.
What are the correct
Select one:
a.
Dr Cost of sales R200 000(P), Cr Revenue(S) P/L R200 000
b.
Dr Revenue(S) (P/L) R200 000, Cr Cost of sales(P) R200 000
c.
Dr Revenue(S)P/L R100 000, Cr Cost of sales(P) R100 000
d.
Dr Revenue(P) P/L R200 000 Cr Cost of sales(P)R200 000
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