The following summarised information relates to the Pagg group of companies. 1 Pagg acquired its shareholding in Ragg Ltd for
The following summarised information relates to the Pagg group of companies.
1 Pagg acquired its shareholding in Ragg Ltd for £3,000 on 1 April 2012. Ragg’s retained profits balance at that time was £600,000. Goodwill arising was £1,720.
2 The shares in Tagg Ltd were acquired on 1 April 2016 for £1,000 when Tagg’s retained profits balance was £100,000. Goodwill arising was £640.
3 Impairment reviews of the goodwill amounts as required by IAS 38 have reduced the investments to the amounts shown above.
4 At 31 March 2017, Ragg had in inventory goods purchased from Tagg at a cost to Ragg of £60,000. These goods had been invoiced by Tagg at cost plus 20%.
5 Intercompany debts at 31 March 2017 were as follows: Pagg owed Ragg £200,000 and Ragg owed Tagg £35,000.
In so far as the information permits, prepare the Pagg group of companies’ consolidated statement of financial position as at 31 March 2017 in accordance with the relevant accounting standards.
Formal notes to the accounts are NOT required, although detailed working must be submitted with your answer.
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