Financial information for Jasmine and Lessard for the year ended December 31, 2013, is shown below: Additional

Question:

Financial information for Jasmine and Lessard for the year ended December 31, 2013, is shown below:

Jasmine Lessard $78,000 $40,000 3,000 1,600 Revenue Gain on sale of office furniture Dividend revenue 4,400 82,400 Total


Additional information:
1. On January 1, 2012, Jasmine purchased 100% of the shares of Lessard for $50,000. At that date the equity of the two entities was as follows:

Jasmine Lessard Retained earnings Share capital 39,500 50,000 6,800 40,000


At January 1, 2012, all the identifiable assets and liabilities of Lessard were recorded at fair value except for the following:


All of this inventory was sold by December 2012. The plant and equipment had a further five-year life.
2. Jasmine records dividends receivable as revenue when dividends are declared.

3. The opening inventory of Lessard included goods that cost Lessard $2,000. Lessard purchased this inventory from Jasmine at cost plus 33 1/3%.
4. Intragroup sales totalled $10,000 for the year. Sales from Jasmine to Lessard, at cost plus 10%, amounted to $5,600 and are still in the closing inventory of Lessard. The closing inventory of Jasmine included goods that cost it $4,400. Jasmine purchased this inventory from Lessard at cost plus 10%.
5. On December 31, 2012, Lessard sold Jasmine offi ce furniture for $3,000. This furniture originally cost Lessard $3,000 and was written down to $2,500 when sold. Jasmine depreciates furniture at the rate of 10% p.a. on cost.
6. During the year, Jasmine paid rent of $7,000 to Lessard.
7. The tax rate is 30%.


Required
Prepare the consolidated statement of comprehensive income for the year ended December 31, 2013.

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Advanced Accounting

ISBN: 978-1118037911

1st Canadian Edition

Authors: Gail Fayerman

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