During the Year Ended 30 June 2014,a Subsidiary Sold Inventory

question 47

Multiple Choice

During the year ended 30 June 2014,a subsidiary sold inventory to a parent for $90 000.The inventory had previously cost the subsidiary entity $72 000.By 30 June 2014 the parent had sold 75% of the inventory to a party outside the group.The remaining inventory was sold externally in July 2014.The company tax rate is 30%.Which of the following is the adjustment entry in the consolidation worksheet at 30 June 2015?

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Definitions:

Antitrust Laws

Legislation to prevent monopolies and promote competition, ensuring fair business practices.

Collusive Behavior

Actions among firms to limit competition, set prices, or otherwise interfere with free market operations, often illegally or in secret.

Cartel

An association of independent businesses organized to regulate production, pricing, and marketing of goods by the members to monopolize a market.

Economic Efficiency

A state where resources are allocated in a manner that maximizes the production of goods and services without wasting any resources.