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Prepare appropriate consolidation journal entries

By admin / July 1, 2020

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Based on the information provided below, prepare appropriate consolidation journal entries for
possible account adjustment or elimination. (7 Mark)
Reference appropriate accounting standards to explain the approach which needs to be taken for the
adjusting journals. (3 Mark)
Parent paid $110 000 on 30 June for all the shares of Subsidiary, whose equity at that date is share
capital $72 000 and retained profits $28 000. However, the assets of Subsidiary are not all recorded
at their fair value. Assume that all companies adopt the revaluation model under AASB 116. The
discrepancies are:

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