During the year ended 30 June 2017, a parent entity rents a warehouse from a subsidiary entity for $200 000. The company tax rate is 30%. Which of the following is the consolidation adjustment entry needed at reporting date to eliminate the transaction?
| I. |
Rent revenue |
Dr |
200 000 |
| Rent expense |
Cr |
200 000 |
| II. |
Rent revenue |
Dr |
200 000 |
| Rent expense |
Cr |
200 000 |
| Income tax expense |
Dr |
60 000 |
| Deferred tax liability |
Cr |
60 000 |
| III. |
Rent revenue |
Dr |
200 000 |
| Rent expense |
Cr |
200 000 |
| Deferred tax asset |
Dr |
60 000 |
| Income tax expense |
Cr |
60 000 |
| IV. |
Rent expense |
Dr |
200 000 |
| Rent revenue |
Cr |
200 000
|