Sailor Berhad acquired all the shares in Mon Berhad on 31 December 2022 for a cost of RM900,000. The statement of financial poistion of both companies for the year ended 31 December 20221 were as follows: Non-current assets Investment in Mon Berhad at cost Current assets Ordinary share Retained earnings Current liabilities Sailor Berhad RM'000 1,600 900 380 2,880 1,000 1,580 300 2,880 Mon Berhad RM'000 750 300 1,050 500 300 250 1,050 Required: Explain by way of calculation on how to prepare the consolidated statement of financial position for the group as at 31 December 2022.
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- On 1 July 2020, Kent Ltd acquired all the share capital (Ex-dividend) of Sub Ltd for $500,000. The financial statements of Kent Ltd showed the equity of Sub Ltd at that date to be: Share capital — 60 000 $5 shares $300 000 General reserve 40 000 Retained earnings 90 000 All the assets and liabilities of Sub Ltd were recorded at amounts equal to their fair values at that date except the following: Carrying Amount Fair value Land $150 000 $170 000 Plant (Cost $400 000) $300 000 $350 000 Inventory $75 000 $80 000 Additional information: On 10 September 2020, Sub Ltd paid interim cash dividend of $10,000. At acquisition date, 1 July 2020, Sub Ltd has an unrecorded Patent that has a fair value of $20,000, and a Contingent Liability that has a fair value of $15 000. Plant has expected to have a further 5-year life. The tax rate…On 1 July 2020, Sky Ltd acquired 70% of the share capital (ex. div.) of Jim Ltd for $500,000. At that date, the relevant balances in the records of Jim Ltd were: Share capital General reserve Retained earnings Dividend payable S 434,000 35,000 126,000 14,000 At the date of acquisition all assets and liabilities of Jim Ltd were recorded in the accounting records at amounts equal to their fair values with the exception of the following assets: Carrying amount Fair value Land Machine 56,000 30,800 Land was sold on 1 May 2023 for $77,000. $ 67,200 49,000 The cost of the Machine was $58,800 and had a further 5-year life as at the date of acquisition. Jim Ltd had reported a Contingent liability at 1 July 2020 in relation to claims by customers for damaged goods. Sky Ltd placed a fair value of $12,600 on these claims at acquisition date. This claim was settled on 1 April 2023 for $7,000. Additional information: a) On 1 March 2023, Jim Ltd purchased inventory from Sky Ltd for $25,200,…On 1 July 2021, James Ltd acquired all the issued shares of Dean Ltd for $350,000. At this date, the financial statements of Dean Ltd showed the following: $ Share capital 270,000 Retained earnings 26,500 General Reserve 8,800 Total equity 305,300 Goodwill 25,000 At acquisition date, all the net identifiable assets and liabilities in Dean Ltd were recorded at amounts equal to their fair value except for: Asset Carrying amount ($) Fair Value ($) Inventories 15,000 18,000 Plant (cost $400,000) 210,000 220,000 The Plant was calculated to have a further life of 5 years, and was depreciated on a straight-line basis. All inventory was sold by 30 June 2020. Assume 30% tax rate Required: Prepare the acquisition analysis at 1 July 2021. Prepare the consolidation entries at acquisition date, 1 July 2021. Include narrations for each entry. Prepare the consolidation worksheet as at 1 July 2021. Prepare a Balance sheet for the reporting Group, James Ltd as at 1 July 2021 in narrative format.
- The following are summarized Balance Sheets as on March 31, 2020 H. Ltd. acquired 80% shares in S Ltd. on October 1, 2019 for $ 2,000. At the date of acquisitionall the assets and liabilities of S Ltd were reflected at fair valueThe Retained earnings of S Ltd. on April 1, 2019 was $ 200H Ltd measures the Non Controlling Interest at its proportionate share of the acquiree's netidentifiable assets.S Ltd transferred goods to H Ltd at a transfer price of $ 300. The sales policy of H Ltd is to add50 % of mark up to its cost. Two-thirds remained in inventory at the year end. Required : Calculate goodwill at the date of acquisition and unrealized profit for holding company1. Given below are the consolidated statements of financial position and the consolidated statement of comprehensive income for Pelangi Berhad and its subsidiary Mentari Berhad: Consolidated Statement of Financial Position as at 31 December 2020 2019 RM'000 RM'000 Property, plant and equipment 1,350 1,300 Investment in associates company 1,000 900 Inventory 900 500 Trade receivables 500 700 Bank 300 150 4,050 3,550 Ordinary shares of RM1 each 2,500 2,500 Retained profits 560 260 Non-controlling interest 590 490 Trade payables 400 300 4,050 3,550 Consolidated Statement of Comprehensive Income for the year ended 31 December 2020 2020 RM'000 Profit 495 Share of profits of associate company (less impairment of goodwill) 130 Profit before tax 625 Тах (50) Profit after tax 575 Profit after tax attributable to: Equity holders of parent company 425 Non-controlling interest 150 575 Additional information: i. Tax charge for the year has been paid. ii. Group depreciation on property, plant and…Blue Ray Bhd. acquired all the assets and liabilities of Sharp Bhd. on 1 July 2021. Given below are the statements of financial position of Blue Ray and Sharp Bhd. as at 1 July 2021: Blue Ray (RM’000) Sharp (RM’000) Non-Current Tangible Assets 400,000 230,000 Goodwill 50,000 Shares in Sharp (30,000) 40,000 490,000 230,000 Current Asset 56,000 36,000 Total Assets 546,000 266,000 Current Liabilities (40,000) (20,000) 506,000 246,000 Ordinary Share capital at RM1 ach 400,000 150,000 Retained Profits 106,000 96,000 506,000 246,000 The acquisition was undertaken under the following terms: Blue Ray agreed to issue 200,000,000 ordinary shares. It was agreed that the fair value of the shares of Blue Ray for the acquisitions is RM1.60. Sharp will go into liquidation. The fair value of the assets and liabilities of Sharp were estimated to be: Tangible Assets…
- Blue Ray Bhd. acquired all the assets and liabilities of Sharp Bhd. on 1 July 2021. Given below are the statements of financial position of Blue Ray and Sharp Bhd. as at 1 July 2021: Blue Ray (RM’000) Sharp (RM’000) Non-Current Tangible Assets 400,000 230,000 Goodwill 50,000 Shares in Sharp (30,000) 40,000 490,000 230,000 Current Asset 56,000 36,000 Total Assets 546,000 266,000 Current Liabilities (40,000) (20,000) 506,000 246,000 Ordinary Share capital at RM1 ach 400,000 150,000 Retained Profits 106,000 96,000 506,000 246,000 The acquisition was undertaken under the following terms: Blue Ray agreed to issue 200,000,000 ordinary shares. It was agreed that the fair value of the shares of Blue Ray for the acquisitions is RM1.60. Sharp will go into liquidation. The fair value of the assets and liabilities of Sharp were estimated to be: Tangible Assets…The following information relates to Adele Ltd. Since the date of acquisition, Adele Ltd has held interests in multiple subsidiaries totalling DNCI of 25%, and INCI of 15%. The following summarised financial information is provided: Retained earnings at DOA $236,000 Retained earnings at 1/7/2020 $476,000 Current period profit for year ended 30/6/2021 $117,000 a) Based on the financial information you have available, prepare the journal entries to record the allocation to NCI upon consolidation on 30 June, 2021.On 1 July 2021, King Ltd acquired all the share capital of Queen Ltd for $1,800,000, and on that date Queen Ltd.'s equity were as follows: Share capital $1,200,000; Revaluation surplus $500,000 and Retained earnings $200,000. All the assets and liabilities of Queen Ltd. were recorded at fair value on 1 July 2021. During the financial year 2022, the following intragroup transactions occurred between King Ltd and Queen Ltd: Queen Ltd sold land to King Ltd for $400,000, which was $100,000 above cost. The land was still hold by King Ltd. King Ltd sold an equipment to Queen Ltd for $400,000. The carrying amount of equipment to King Ltd of $320,000. Both entities depreciate equipment at a rate of 10% p.a. on cost. Queen Ltd sold inventories costing $160,000 to King Ltd for $180,000. 1/4th of the inventories were still on hand with King Ltd. King Ltd received $15,000 of service revenue from Queen Ltd. Queen Ltd paid dividend of $30,000 and interest on loan of $8,000 to King Ltd. The tax rate…
- Unicorn Ltd acquired 80% of the issued shares of Pegasus Ltd for $685,700 on 1 July 2020. The financial statements of Pegasus Ltd showed the following items of equity: Share capital $565,500 Retained earnings $247,400 At acquisition date all the identificable assets and liabilities of Pegasus Ltd were recorded at amounts equal to fair value except for the following: Carrying amount Fair value Land $395,900 $424,100 During the year end 30 June 2021, Pegasus Ltd recorded at profit of $84,800. The tax rate is 30%. Required: Show the acquisition analysis as at 1 July 2020 and prepare the consolidated worksheet entries at 30 June 2021 for Unicorn Ltd assuming that it adopts the partial goodwill method.On 1 July 2020, Big Ltd acquired all the issued share capital of Small Ltd for cash for an amount of $1,050,000. On the date of the acquisition, the statements of the financial position of both entities are as follows: Big Ltd ($) Small Ltd ($) Assets Cash 21,000 10,500 Accounts receivable 315,000 115,500 Land 420,000 210,000 Plant 1,680,000 1,050,000 Investment in Small Ltd 1,050,000 3,486,000 1,386,000 Liabilities Accounts payable 126,000 63,000 Loans payable 840,000 315,000 Shareholders’ equity Share capital 2,100,000 420,000 Retained earnings 420,000 588,000 3,486,000 1,386,000 Required: a.Calculate the goodwill on acquisition assuming all net assets of small Ltd are recorded in fair value. b.Prepare consolidation journal entries. c.On 1 July 2020, Big Ltd acquired all the issued share capital of Small Ltd for cash for an amount of $1,050,000. On the date of the acquisition, the statements of the financial position of both entities are as follows: Big Ltd ($) Small Ltd ($) Assets Cash 21,000 10,500 Accounts receivable 315,000 115,500 Land 420,000 210,000 Plant 1,680,000 1,050,000 Investment in Small Ltd 1,050,000 3,486,000 1,386,000 Liabilities Accounts payable 126,000 63,000 Loans payable 840,000 315,000 Shareholders’ equity Share capital 2,100,000 420,000 Retained earnings 420,000 588,000 3,486,000 1,386,000 Required: a. Calculate the goodwill on acquisition assuming all net assets of small Ltd are recorded in fair value. b. Prepare consolidation journal entries. c.