Sunflower Ltd purchased 100% of the issued capital of Rose Ltd for a cash consideration of $1.7 million on 1 July 2019. At that time the fair value of the net assets of Rose Ltd were represented by:

Share capital $1,000,000
Retained earnings $500,000

Goodwill had been determined to have been impaired by $20 000 during the period.

During the period ended 30 June 2020, Rose Ltd sold inventory that cost $450 000 for $620 000 to Sunflower Ltd. Twenty per cent of this inventory remains on hand in Sunflower Ltd at the end of the year. Both companies use a perpetual inventory system. The taxation rate is 30%.

At the end of the period Rose Ltd declared a dividend of $45 000 that has not yet been paid.


What consolidation journal entries are required for the period ending 30 June 2020?

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