Required: Prepare a consolidated balance sheet worksheet. Note: Values in the first two columns (the "parent" and "subsidiary" balances) that are to be deducted should be indicated with a minus sign, while all values in the "Consolidation Entries" columns should be entered as positive values. For accounts where multiple adjusting entries are required, combine all debit entries into one amount and enter this amount in the debit column of the worksheet. Similarly, combine all credit entries into one amount and enter this amount in the credit column of the worksheet.
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- QUESTION ONE The following financial information relates to Sporty Limited. Statement of Financial Position as at 31 December 2018 and 2019 Ordinary share capital Retained earnings Property, plant and equipment Investments Debentures 12.5% Inventory Trade debtors Prepaid expenses Trade creditors Bank overdraft SARS (income tax) Shareholders for dividends Profit before interest and tax Depreciation on equipment Dividends received on investments Interest on dividends Income tax Page 2 of 6 2019 R 400 000 55 000 230 000 165 000 20 000 124 000 37 000 Statement of comprehensive income for the year 31 December 2019 Note no. 1 for the year ended 31 December 2018 and 2019 Property, plant and equipment Land and building at cost Equipment at carrying value 25 000 21 000 5 000 30 000 Statement of changes in equity for the year ended 31 December 2019 Dividends on ordinary shares 2019 (R) 200 000 30 000 230 000 R R 295 000 5 000 195 000 110 000 2018 60 000 120 000 28 500 1 500 42 500 25 000 R 60…QUESTION Two The trial balance of SHAKERS LTD as at 31st December 2009 is as follows: GH¢ GH¢ Revenue and Purchases 20,000 50,000 8,000 Inventory Distribution costs 8,000 Administration expenses Receivables and Payables Reorganization expenses 15,550 10,000 20,000 2,400 Cash and bank 8,100 Stated Capital (@GH¢1.00/share) 10% Irredeemable Preference Shares (@GH¢1.00/share) 11,000 9,000 10% Debentures 8,000 Non-current Assets at Net Book Value 35,000 Retained Earnings (@ 1 January 2009) Debenture interest paid 3,000 400 Preference dividend paid Interim ordinary dividend paid 450 1,600 Тах 500 Suspense 8,000 109,500 109,500 The following is to be taken into account 1. A building whose Net Book Value is currently GH¢5,000 was revalued to GH¢11,000. 2. A final ordinary dividend of GH¢0.10 per share is to be provided for, in addition to the interim dividend paid. 3. The balance on the corporation tax account represents an overprovision of tax for the previous year. Tax for the current year…Exercise 6-13 (Algo) Consolidated Balance Sheet Worksheet LO 6-3, 6-4 The December 31, 20x8, balance sheets for Pint Corporation and its 70 percent-owned subsidiery Saloon Company contained the following summarized amounts Assets Cash and Receivables Inventory Buildings and Equipment (net) Investment in Saloon Company Total Assets S PINT CORPORATION AND SALOON COMPANY Balance Sheets December 31, 20x8 Liabilities and Equity Accounts Payable Common Stock Retained Earnings Total Liabilities and Equity view transaction list Consolidation Worksheet Entries
- PROBLEM 5 - 5 (PFRS for SMES) Shadow Company acquired the net assets of Recruit Company on July 1, 2019, and made the following entry to record the acquisition (both using PFRS for SME): Current and Non-current assets Goodwill 3,600,000 600,000 Liabilities Ordinary share capital, P1 par Share Premium 480,000 600,000 3,120,000 The agreement further provides that additional cash consideration would be paid on June 30, 2020, equal to twice the amount by which net eamings of Recruit Company exceed P300,000 with the first 12 months of acquisition. Net income was P260,000 in 2019 (earned evenly) and P160,000 for the first six months of 2020. Included in the goodwill computation and liabilities above is the fair value of the contingent consideration, which was estimated to be P80,000 as of July 1, 2019, although assessed as not probable at this date. What should be the amount of Goodwill on December 31, 2020?Question 2:The following is the trial balance of Muti Tech Limited as at December 31, 2006.Paid-up share capital10,00,0005,00,000Share premiumNet income January 1, 200610% Debentures payable 20107,00,0006,00,000Piant and assets39,00,000Accumulated DepreciationMerchandise inventory4,60,0008,80,000Accounts receivableAccounts payable4,20,0003,60,000Purchases and sales36,50,00065,40,0005,00,00070,000Administrative salariesSales salariesDirectors remunerationAdvertising expensesCarriage outwardsUtility expenses1,60,0002,80,0001,00,0003,00,000Bank overdraft1,00,0001,02,60,000 1,02,60,000Additional Information:The paid-up share capital consists of 100,000 shares of Rs. 10 each.Merchandise inventory at December 31, 2006 was Rs. 500,000.Estimated tax on the profit of the company for the year is Rs. 1,50,000. The directorsa.b.have proposed final dividend of 10% on the ordinary share capital.d. Depreciation is provided at 10 percent per annum on plant and assets. Allowance forbad debts is to be…Question Armadillo Enterprises acquired the following equity investmentsat the beginning of year 1 as trading investments. Description Number of shares Market price per share Total price Finestra Company 15,000 X $25 $387,500 BVD Company 20,000 x$18 |S360,000 Market values at theend of Years 1 &2 are presented below: Market/Fair Value End of year 1 End of year 2 Finestra Company IS19 $23 BVD Company $22 $28 REQUIREMENTS: ( Prepare the journal entry to record the acquisition of theinvestments. Prepare the adjusting journal entry required at the end of year1. Armadillo Enterprises sells 15,000 shares of BVD Company for $16at the beginning of year 2. Prepare the journal entry to record thesale. Prepare the adjusting journal entry required at the end of year2. Assume that ArmadilloEnterprises now holds these investments asavailable-for-sale. Prepare the journal entry to record the acquisition of theinvestments. Prepare the adjusting journal entry required at the end of year1. Armadillo…
- Problem 1 - you can make calculations in Excel and upload it on the last page On 1 January 20X9, JB Enterprises acquired 70 per cent of the shares of Good Company. The separate condensed statements of financial position of JB Enterprises and of Good Company immediately after the acquisition appeared as shown below: (all amounts in €) JB Good Company Assets Property, plant and equipment (net) 18.750.000 2.600.000 Investment in Good Company 3.600.000 Inventories 1.000.000 740.000 Cash 13.550.000 560.000 Trade and other receivables 4.400.000 660.000 41.300.000 4.560.000 Equity and Liabilities Share capital 10.000.000 2.000.000 Reserves 16.200.000 1.600.000 Profit for the year 20X4 1.600.000 240.000 Provisions 100.000 250.000 Current liabilities 13.400.000 470.000 41.300.000 4.560.000 Additional information (at acquisition date): A. The fair value of Good Company's production equipment (with a remaining useful life of 3 years) implies a surplus value of €120,000 over its carrying amount.…BADVACIX – ACCOUNTING FOR BUSINESS COMBINATIONS MODULE 2: CONSOLIDATED FINANCIAL STATEMENTS PROBLEM 1 (80% - Owned Subsidiary) Sim Corporation's balance sheet at January 1, 20x4, reflected the following balances: P 80,000 120,000 70,000 Buildings and Equipment (net) 480,000 P 40,000 60,000 200,000 250,000 200,000 P750,000 Cash and Receivables Accounts Payable Income Taxes Payable Bonds Payable Common Stock Inventory Land Retained Eamings Total Liabilities and Stockholders Equity Total Assets P750,000 Ford Corporation entered into an acquisition program and acquired 80 percent of Slim's common stock on January 2, 20x4, for P470,000. The fair value of the non controlling interest at the date was determined to be at P117,500. A careful review of the fair value of AA's assets and liabilities indicated the following: Accounts Book value Fair value Inventory Land P120,000 70,000 Buildings and equipment (net) 480,000 P140,000 60,000 550,000 Required 1: Compute the appropriate amount to be…FAR5 - Chapter 7: Consolidated Statement of Financial Position Question 1 Dayang Berhad acquired 100% ordinary shares of Daia Berhad on 1st June 20XX. Below are the statements of financial position of Dayang Berhad and Daia Berhad. Machinery Plant, property and equipment Vehicles Inventories Account receivables Investment in Daia Berhad Account payables Long-term loans Ordinary shares Retained earnings Dayang Berhad (RM) 2,000,000 11,000,000 500,000 3,500,000 700,000 9,300,000 1,100,000 5,000,000 13,000,000 7,900,000 i. Calculate goodwill. ii. Record the relevant journal entries. iii. Prepare the consolidated statement of financial position. Daia Berhad (RM) 5,000,000 100,000 500,000 300,000 200,000 5,000,000 700,000
- Question 5 On May 31, 2023, Rooney Company paid $2,100,000 to purchase Frances Corporation, which became a division of Rooney. Frances reported the following balance sheet at the time of the acquisition: Current assets Noncurrent assets $ 500,000 1.800.000 Current liabilities Long-term liabilities Stockholders' equity Total liabilities and $ 400,000 300,000 1,600,000 Total assets $2.300.000 $2,300,000 It was determined at the date of the purchase that the fair value of the identifiable net assets of Frances was $1,800,000. At December 31, 2023, Frances reports the following balance sheet information: stockholders' equity $ 400,000 1,600,000 Current assets Noncurrent assets (including goodwill recognized in purchase) Current liabilities (500,000) (300,000) Long-term liabilities Net assets $1.200.000 It is determined that the fair market value of the Frances division is $1,250,000 at this time. Instructions a. Compute the amount of goodwill recognized, if any, on May 31, 2023. b.…QUESTION 3 Entity A invested in 3,386,000 shares of a listed company on 1 October 2023 at a cost of $3.68 per share. On 31 December 2023, the shares had a market value of $6.94 per share. Entity A is not planning on selling these shares in the short term and elects to hold them as Fair Value through Other Comprehensive Income. REQUIRED: (1) Measure the amounts of the financial asset recognised in the Statement of Financial Position on 31 December 2023. (2) Measure the amounts recognised in the Statement of Profit or Loss for the financial asset of the year 2023. (3) Measure the amounts of the Fair Value Reserve recognised in the Statement of Financial Position on 31 December 2023. ANSWERS: (1) The answer = $ (2) The answer = $ (3) The answer = $ (If it is a gain of $10, enter 10. If it is a loss of $10, enter -10.)Problem 1-16 Humility Inc. acquired 70% interest of Forgiveness Company, a printing business. The sale and purchase agreement specify the amount payable as: Cash of P12 million to be paid on acquisition date, and b. Additional 2,000 shares of its P100 par value ordinary shares to be issued after two (2) years if specified product receives the target market share. The fair value of Forgiveness Company's net assets is P11 million and estimated fair value of the contingent consideration is P300,000. NCI is measured using the proportionate method. Required 1. Assuming the target was met and shares was issued to the former shareholders of Forgiveness, the estimated fair value of contingent consideration is P400,000, how much goodwill will be presented in the consolidated financial statements two years after the acquisition? 2. Journal entry in the books of Humility Inc. (a) on the date of business combination and (b) on the issuance of 2,000 shares, in relation to #1. 3. Assuming the target…