The following are the statutory individual Statements of Financial Position for three companies on 31 March 2021:
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Question:
The following are the statutory individual Statements of Financial Position for three companies on 31 March 2021:
The following additional information is relevant:
- On 1 April 2020 A acquired 1,200,000 ordinary £1 shares in B for £7,800,000 when the retained earnings in B were £4,050,000.
- At the date of acquisition, it was determined that the fair value of net assets in B were equal to their carrying value with the exception of land which had a fair value of £750,000 in excess of its carrying amount.
- On 1 April 2020 A acquired 450,000 ordinary £1 shares in C for £1,350,000 when the retained earnings in C were £1,900,000.
- In the year ended 31 March 2021 A sold goods on credit to B for £500,000. Half of these goods remain in B's inventory at year-end. A makes a 20% margin on all goods sold.
- At 31 March 2021 an impairment test was conducted and it was found that the goodwill on the acquisition of B is impaired by £60,000 and the investment in C is impaired by £50,000.
YOU ARE REQUIRED TO:
- Prepare a consolidated statement of financial position for the A group as at 31 March 2021.
Note: The group policy is to value non-controlling interest at the proportionate share of the fair value of net assets at acquisition.
Related Book For
Fundamentals of Cost Accounting
ISBN: 978-0077398194
3rd Edition
Authors: William Lanen, Shannon Anderson, Michael Maher
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