Knights Ltd Purchased Inventory from Its Subsidiary,Gidley Ltd,for $20 000

question 32

Multiple Choice

Knights Ltd purchased inventory from its subsidiary,Gidley Ltd,for $20 000.The goods originally cost Gidley Ltd $12 000.The company tax rate is 30%.Assuming that all of the inventory was still on hand at the end of the year,which of the following consolidation adjustment entries is required?

• A)Dr Tax expense $2400; Cr Deferred tax liability $2400
• B)Dr Tax expense $2400; Cr Deferred tax asset $2400
• C)Dr Deferred tax asset $2400; Cr Tax expense $2400
• D)Dr Deferred tax liability $2400; Cr Tax expense $2400

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Definitions:

Sexual Arousal

A physiological and psychological state of being awake or stimulated to a point of heightened sexual receptivity and desire.

Estrogen

A group of sex hormones that play an essential role in the development and regulation of the female reproductive system and secondary sex characteristics.

Pubertal Development

The period of life during which a child's body matures into an adult body capable of sexual reproduction, including physical and hormonal changes.

Prenatal Development

Prenatal development refers to the process of growth and development within the womb, from the formation of an embryo to the development of a full-term fetus.