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Clovelly Ltd, Owns 25% of Bronte Ltd

Question 3

Multiple Choice

Clovelly Ltd, owns 25% of Bronte Ltd. Bronte's profit after tax for the year ended 30 June 20X3 is £30 000. The tax rate is 30%. During the year ended 30 June 20X4, Bronte sold £5000 worth of inventory to Clovelly. These items had previously cost Bronte £3000. All the items remain unsold by the Clovelly at 30 June 20X3. Clovelly's share of Bronte's profit for the year ended 30 June 20X3 is:


A) £5500
B) £6250
C) £7150
D) £7000

Correct Answer:

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