On 1 July 2021 Borris Ltd purchased 80 per cent of the shares of Natasha Ltd for $8 million. On 1 July 2021 the shareholders’ funds of Natasha Ltd were:

Additional information

• The management of Borris Ltd measures any non-controlling interest in Natasha Ltd at fair value.
• At acquisition date, all assets of Natasha Ltd were fairly stated, except land that had a fair value $225000 in excess of its carrying amount.
• On 30 June 2023 the recoverable amount of goodwill of Borris Ltd was assessed to be $500 000. There had been no previous impairment losses recognised in relation to goodwill.
• During the financial year ending 30 June 2023 Natasha Ltd sold inventory to Borris Ltd at a sales price of $290 000. The inventory cost Natasha Ltd $200 000 to produce. At 30 June 2023, half of this inventory had been sold by Borris Ltd.
• On 1 July 2022 Natasha Ltd sold an item of plant to Borris Ltd for $250 000 when it had a carrying amount of $200 000 (cost of $400 000, accumulated depreciation of $200 000). The item of plant was expected to have a remaining useful life of five years from the date of sale and is depreciated using the straight-line method of depreciation.
• Natasha pays $30 000 per year in management fees to Borris Ltd.
• The income tax rate is 30 per cent.
• Statement of profit or loss and other comprehensive income of Borris Ltd and Natasha Ltd for the year ended 30 June 2023.

Statement of financial position of Borris Ltd and Natasha Ltd as at 30 June 2023

Borris Ltd
Statement of changes in equity for the year ended 30 June 2023

REQUIRED

1. Prepare the consolidation worksheet journal entries for Borris Ltd and its controlled entity as at 30 June 2023 and post them to a consolidation worksheet.

2. Calculate the non-controlling interest in profit and equity as at 30 June 2023.

3. Prepare the consolidated statement of financial position, consolidated statement of profit or loss and other comprehensive income and consolidated statement of changes in equity for Borris Ltd and its controlled entities, clearly showing non-controlling interests.

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Share capital Retained earnings $5 500 000 $3 500 000 $9 000 000