A Ltd acquired all issued shares of B Ltd on 1 July 2020. On the same...
A Ltd acquired all issued shares of B Ltd on 1 July 2020. On the same date, B Ltd had a contingent liability disclosed in the notes to its individual financial statement. The consolidation worksheet entries on 1 July 2020 in relation to this contingent liability will record:
a. a reduction in goodwill
b. a deferred tax asset
c. no record should be made
d. a deferred tax liability
Homework Answers
D ) deferred tax liability
because as contingent liability in consolidation accounts is treated as deferred tax liability in notes to accounts of balance sheet. it should be disclosed at the last of accounts in the form of notes .
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