Forest plc acquired 80% of the ordinary shares of Bulwell plc some years ago. At acquisition, the fair values of the assets of Bulwell plc were the same as their carrying value. Bulwell plc manufactures plant and equipment.
On 1 January 20X3, Bulwell sold an item of plant & equipment to Forest plc for $2 million. Forest plc depreciates plant and equipment at 10% per annum on cost, and charge this expense to cost of sales. Bulwell plc made a gross profit of 30% on the sale of the plant and equipment to Forest plc.
The income statements of Forest and Bulwell for the year ended 31 December 20X3 are:

Required:
Prepare an income statement for the Forest plc group for the year ended 31 December20X3.

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Revenue Cost of sales Gross profit Other operating expenses Profit before tax Taxation Profit after tax Forest $000 21,300 14,900 Bulwell 5000 8,600 6,020 6,400 2,580 3,700 1750 2,700 820 ,880 830 580