B330 Limited always sells inventory items to its subsidiary B380 Limited at a 40 percent markup on cost. During the 20X7 financial year, the unrealised profit in opening inventory of B380 Limited exceeds that of its unrealised profit in closing inventory. Assuming the same tax rate for both 20X6 and 20X7 financial years, which of the following statements is correct with respect to B330 Limited’s consolidated financial statements after considering these transactions only?Group of answer choicesConsolidated profit for the 20X7 financial year will decrease.Consolidated sales and purchases/cost of goods sold for the 20X7 financial year will be unaffected.The retained earnings opening balance for the 20X7 financial year will increase.Consolidated profit for the 20X7 financial year will increase.

41. Which of the following would result in an unrealised profit within a group scenario? A A parent sells a building originally costing $800,000 to its subsidiary for $900,000. The subsidiary still holds this asset at the date of consolidation. B A parent sells a building originally costing $800,000 to its subsidiary for $900,000. The subsidiary has sold this asset before the date of consolidation. C A parent sells goods which originally cost $14,000 to its subsidiary for $18,000. The subsidiary has sold all of these goods at the date of consolidation. D A parent sells goods which originally cost $14,000 to an associate for $18,000. The associate has sold all of these goods at the date of consolidation. 42. Which of the following explains the value that relevant information contains? A Instructive value B Fair value C Confirmatory value D Approximate value 43. Which of the following is an example of following the principle of faithful representation? A Showing lease payments as a rental expense B Being prudent by recording the entire amount of a convertible loan as a liability C Creating a provision for staff relocation costs as part of a planned restructuring D Recording a sale and repurchase transaction with a bank as a loan rather than a sale 44. A forum for consultation with parties affected by the work of the International Accounting Standards Board is provided by: A The International Financial Reporting Interpretations Committee B The IFRS Advisory Council C The IFRS Foundation D The IFRS Consulting Committee 45. Which of the following criteria need to be satisfied in order for an element to be recognised within the financial statements? (i) It meets the definition of an element of the financial statements. (ii) Recognition provides relevant information. (iii) Recognition provides a reliable measure. (iv) The element has fair value. (v) Recognition provides faithful representation of the element. A (i), (ii) and (v) B (i), (iii) and (v) C (i), (ii) and (iv) D (i), (iii) and (iv) give me only the correct options no explanation

During the 20X7 financial year, X Ltd sells inventory to its parent P Ltd for $90,000 representing a mark-up of 50% on cost. At 30 June 20X7, 3/4 of the goods are still held by P Ltd. The unrealised profit to be eliminated on consolidation is: a. $10,000 b. $22,500 c. $60,000 d. $30,000

An overstatement of the beginning inventory results in:Question 3Answera.an overstatement of profitb.an understatement of profitc.no effect on the period’s profitd.a need to adjust purchases

If sales = $455,000, purchases = $225,000, beginning inventory = $150,000 and ending inventory = $118,000, gross profit is:$198,000$230,000$75,000$257,000

A Limited acquired 100% of the share capital of B Limited for $765000. B Limited had total shareholder's equity of $400000. Thebook values of B Limited's assets were: buildings $100000, machinery $180000. The fair values of these assets were: buildings6290000. machinery $350000. The tax rate is 30%. The acqisition analysis wil determine goodwill or gain on bargain purchase