Solved

Lesser Ltd Is Wholly Owned by Moore Ltd

Question 48

Multiple Choice

Lesser Ltd is wholly owned by Moore Ltd.In the current year Lesser Ltd has made a tax loss of $200,000 and Moore Ltd has made a profit of $300,000.It is expected that Lesser Ltd will make sufficient profits in the future to utilise the benefits of the tax loss,so Lesser has recorded a deferral for the loss.Moore pays Lesser $10,000 consideration for the transfer of the tax loss.Neither Moore nor Lesser have elected to be part of a tax consolidated group.The taxation rate is 30 per cent.What are the appropriate entries to record the transfer (only) ?


A) Lesser Ltd is wholly owned by Moore Ltd.In the current year Lesser Ltd has made a tax loss of $200,000 and Moore Ltd has made a profit of $300,000.It is expected that Lesser Ltd will make sufficient profits in the future to utilise the benefits of the tax loss,so Lesser has recorded a deferral for the loss.Moore pays Lesser $10,000 consideration for the transfer of the tax loss.Neither Moore nor Lesser have elected to be part of a tax consolidated group.The taxation rate is 30 per cent.What are the appropriate entries to record the transfer (only) ? A) B) C) D) E) None of the given answers.
B) Lesser Ltd is wholly owned by Moore Ltd.In the current year Lesser Ltd has made a tax loss of $200,000 and Moore Ltd has made a profit of $300,000.It is expected that Lesser Ltd will make sufficient profits in the future to utilise the benefits of the tax loss,so Lesser has recorded a deferral for the loss.Moore pays Lesser $10,000 consideration for the transfer of the tax loss.Neither Moore nor Lesser have elected to be part of a tax consolidated group.The taxation rate is 30 per cent.What are the appropriate entries to record the transfer (only) ? A) B) C) D) E) None of the given answers.
C) Lesser Ltd is wholly owned by Moore Ltd.In the current year Lesser Ltd has made a tax loss of $200,000 and Moore Ltd has made a profit of $300,000.It is expected that Lesser Ltd will make sufficient profits in the future to utilise the benefits of the tax loss,so Lesser has recorded a deferral for the loss.Moore pays Lesser $10,000 consideration for the transfer of the tax loss.Neither Moore nor Lesser have elected to be part of a tax consolidated group.The taxation rate is 30 per cent.What are the appropriate entries to record the transfer (only) ? A) B) C) D) E) None of the given answers.
D) Lesser Ltd is wholly owned by Moore Ltd.In the current year Lesser Ltd has made a tax loss of $200,000 and Moore Ltd has made a profit of $300,000.It is expected that Lesser Ltd will make sufficient profits in the future to utilise the benefits of the tax loss,so Lesser has recorded a deferral for the loss.Moore pays Lesser $10,000 consideration for the transfer of the tax loss.Neither Moore nor Lesser have elected to be part of a tax consolidated group.The taxation rate is 30 per cent.What are the appropriate entries to record the transfer (only) ? A) B) C) D) E) None of the given answers.
E) None of the given answers.

Correct Answer:

verifed

Verified

Unlock this answer now
Get Access to more Verified Answers free of charge

Related Questions

Q43: Recognising deferred tax assets and deferred tax

Q44: Which of the following statements is correct

Q45: What is the accounting treatment for goodwill

Q46: The transfer of tax losses to other

Q47: Which of the following statements is correct

Q49: On 1 January 2012,William Bay Ltd purchased

Q50: The balance sheet approach adopted in AASB

Q51: If a tax rate changes from 30

Q52: Which of the following statements is not

Q53: Criteria used by an entity to assess

Unlock this Answer For Free Now!

View this answer and more for free by performing one of the following actions

qr-code

Scan the QR code to install the App and get 2 free unlocks

upload documents

Unlock quizzes for free by uploading documents