171819202122232425262728293031323334353637Griffin Ltd acquired all the issued shares (cum div.) in Python Ltd on 1 July 2020, paying 5905 000 cash.Costs incurred in undertaking the acquisition amounted to $7 000, these did not relate to issuing the new shares.On 30 June 2020, the financial statement of Python Ltd showed the following balances:Share capital (12,000 shares @50 each)Retained earningsDividend payableGoodwill$600,000$270,000$36,000$17.500All the identifiable assets and liabilities of Python Ltd at the acquisition date were recorded at amounts equal to their fair values except for:Fair valueInventoryPlant (Cost $1,250,000)Carrying amount$60,000$875,000$52,000$887,000The assets recognised by Python Ltd did not include an internally generated patent of Python Ltd that was valued by Griffin Ltd at $28,000.its useful life was considered to be 4 years, with benefits being received equally over that period.80% of the inventory on hand at the acquisition date was sold by 30 June 2021. The plant is expected to have a further useful life of 5 years. The tax rate is 30%Required:Show the acquisition analysis as at 1 July 2020 and prepare the pre-acquisition consolidation worksheet at 30 June 2021,using the worksheet provided below for the preparation of the consolidated financial statements of Griffin Ltd.Assume that goodwill is accounted for as a Business Combination Valuation Reserve (BCVR) entry.

The consideration transferred by Griffin Ltd is the cash paid $905,000 plus the costs incurred in…

Required: Show the acquisition analysis as at 1 July 2020 and prepare the pre-acquisition consolidation worksheet at 30 June 2021, using the worksheet provided below for the preparation of the consolidated financial statements of Griffin Ltd. Assume that goodwill is accounted for as a Business Combination Valuation Reserve (BCVR) entry.

Required: Show the acquisition analysis as at 1 July 2020 and prepare the pre-acquisition consolidation worksheet at 30 June 2021, using the worksheet provided below for the preparation of the consolidated financial statements of Griffin Ltd. Assume that goodwill is accounted for as a Business Combination Valuation Reserve (BCVR) entry.

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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PLTO Ltd. is considering purchasing the net assets of Ivanhoe Corporation. Following is the statement of financial position of Ivanhoe as at December 31, 2023: Ivanhoe Corporation Statement of Financial Position As at December 31, 2023 Current assets Buildings and equipment Accumulated depreciation Land Total assets Current liabilities Common shares Retained earnings Total equities Current assets Building and equipment Land Following are the fair values for Ivanhoe's net assets, as at December 31, 2023: Current liabilities $230,400 754,000 (108,000) 169.000 Value of goodwill $1,045,400 $187,000 582,000 276,400 $1,045,400 $ Calculate the value of goodwill that would be acquired by PLTO if it offered $2,061,600 for the net assets of Ivanhoe. $224,500 488,400 309,700 (166,000) $856,600
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