The statements of financial position for ST and UV as at 31 December 20X4 are provided below:

Additional innformation:

ST acquired 80 per cent of the ordinary shares of UV on 1 May 20X1 for $1,100,000. At the date of acquisition UV had retained earnings of $360,000. Goodwill that arose on the acquisition of UV was impaired by 20 per cent in the year to 31 December 20X2. On 1 October 20X4, ST disposed of 20,000 $1 ordinary shares of UV for $115,000. The proceeds were debited to cash and credited to retained earnings.

Required:

Explain how the disposal of shares in UV should be accounted for in the consolidated financial statements of ST for the year to 31 December 20X4.

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Assets Non-current assets Property, plant and equipment Investment Current assets Inventories Receivables Cash and cash equivalents Total assets Equity and liabilities Equity Share capital ($1 equity shares) Retained earnings Other reserves Total equity Non-current liabilities Long term borrowings Current liabilities Total liabilities Total equity and liabilities ST $000 2,760 1,190 3,950 550 850 200 1,600 5,550 2,500 1,785 90 4,375 675 500 1,175 5,550 UV $000 1,000 1,000 200 225 75 500 1,500 250 1,000 1,250 250 250 1,500