5 MC QuestionsOn 1 July 2019, Peter Limited acquired all the issued shares of Kerri Limited for $100 000 when the equity of Kerri Limited consisted of: Share capital $70 000Retained earnings 30 000 The pre-acquisition entry at 1 July 2019 is: a.Shares in Kerri LimitedDr100 000 Retained earningsCr 30 000 Share capitalCr 70 000 b. Retained earnings Dr 30 000 Share capitalDr70 000 Shares in Kerri LimitedCr 100 000 c.Retained earningsDr70 000 Share capitalDr30 000 Shares in Kerri LimitedCr 100 000 d.GoodwillDr30 000 Share capitalDr70 000 Shares in Kerri LimitedCr 100 000

The answer is a) Shares in Kerri Limited Dr 100 000 Retained earnings. CR 30000 Share…

Answered: On 1 July 2019, Peter Limited acquired…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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5 MC Questions

On 1 July 2019, Peter Limited acquired all the issued shares of Kerri Limited for $100 000 when the equity of Kerri Limited consisted of:

Share capital $70 000

Retained earnings 30 000

The pre-acquisition entry at 1 July 2019 is:

a.	Shares in Kerri Limited	Dr	100 000
	Retained earnings	Cr		30 000
	Share capital	Cr		70 000
b.	Retained earnings	Dr	30 000
	Share capital	Dr	70 000
	Shares in Kerri Limited	Cr		100 000
c.	Retained earnings	Dr	70 000
	Share capital	Dr	30 000
	Shares in Kerri Limited	Cr		100 000
d.	Goodwill	Dr	30 000
	Share capital	Dr	70 000
	Shares in Kerri Limited	Cr		100 000

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