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Kangaroo Limited has a 100% holding in Paddock Limited Paddock Limited sold Kangaroo Limited inventory on...

Kangaroo Limited has a 100% holding in Paddock Limited

Paddock Limited sold Kangaroo Limited inventory on 1st October 2019 for $68 000. This inventory had cost Paddock Limited $52 000. During the remainder of the financial year Kangaroo Limited had sold one-half of the inventory to an external company on 31st March 2020 for $49 000 and one-quarter to another external company on 1st May 2020 for $25 000.

Prepare the Consolidation Adjusting Journal Entries for the consolidated financial statements as at 30 June 2020 by adjusting for the internal sale by reversing the sale proceeds and the cost of sales, the external sales at an inflated cost of sales, and the reduction in value of the remaining inventory.

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