A Ltd Sells Inventory to Its Parent P Ltd for $60

question 9

Multiple Choice

A Ltd sells inventory to its parent P Ltd for $60 000 representing a mark-up of 50% on cost.At year-end,3/4 of the goods are still held by P Ltd.The unrealised profit to be eliminated on consolidation is:

• A) $20 000.
• B) $15 000.
• C) $30 000.
• D) $10 000.

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Definitions:

Predictable Stages

Predictable stages refer to the recognized phases or steps that occur in a specific sequence within processes, developments, or life cycles, which can be anticipated.

Disability

A physical or mental condition that limits a person's movements, senses, or activities.

Economic Justice

The principle or practice of ensuring fairness in economic systems, such as equitable distribution of wealth, opportunities for economic participation, and access to resources.

Material Goods

Physical items that are produced for purchase and consumption, providing economic value or utility.