Q8 Consolidation 24 Points The following information is relevant to question 8.1 and 8.2. On 1...

  

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Q8 Consolidation 24 Points The following information is relevant to question 8.1 and 8.2. On 1 July 2019, Leonardo Ltd acquired 80% of the issued shares of Donatello Ltd. At the date of the business combination, Donatello Ltd has an item of plant that has carrying amount of $100,000 and fair value of $130,000. The plant was purchased at cost of $250,000. The plant is depreciated on a straight-line basis and has a further useful life of five years, with no residual value. The plant was sold by Donatello Ltd to external entities on 31 December 2023 for $15,000. The tax rate is 30%. Q8.2 5 Points Prepare the consolidation journal entries relating to plant for the consolidated financial statements of Leonardo Ltd (including any entries relating to NCI) at 30 June 2024. Please select file(s) Select file(s) Q8.3 16 Points On 1 July 2015, Michelangelo Ltd acquired 75% of the issued shares of Rafael Ltd. At the date of the business combination the following information was relevant in relation to inter-entity transactions between Michelangelo and Rafael: • At 30 June 2019, inventories of Michelangelo included assets sold to it by Rafael for a before-tax profit of $1,200. These items were sold to external entities during the year ended 30 June 2020. On 1 January 2020, Rafael sold plant to Michelangelo for a before-tax profit of $4,800. The carrying amount of the plant was $12,000 at the time of sale (original cost $80,000). The plant was depreciated on a straight-line basis and had a further useful life of five years, with no residual value. . During the year ended 30 June 2020, Rafael had sold inventories to Michelangelo for $120,000. The mark-up on sales was 25% on cost. At 30 June 2020, Michelangelo still had some of these inventories on hand, amounting to items acquired from Rafael for $12,000. Michelangelo Ltd uses partial goodwill method. Q8.3 16 Points On 1 July 2015, Michelangelo Ltd acquired 75% of the issued shares of Rafael Ltd. At the date of the business combination the following information was relevant in relation to inter-entity transactions between Michelangelo and Rafael: At 30 June 2019, inventories of Michelangelo included assets sold to it by Rafael for a before-tax profit of $1,200. These items were sold to external entities during the year ended 30 June 2020. . On 1 January 2020, Rafael sold plant to Michelangelo for a before-tax profit of $4,800. The carrying amount of the plant was $12,000 at the time of sale (original cost $80,000). The plant was depreciated on a straight-line basis and had a further useful life of five years, with no residual value. . During the year ended 30 June 2020, Rafael had sold inventories to Michelangelo for $120,000. The mark-up on sales was 25% on cost. At 30 June 2020, Michelangelo still had some of these inventories on hand, amounting to items acquired from Rafael for $12,000. Michelangelo Ltd uses partial goodwill method. Required: Prepare the consolidation journal entries (including any necessary entries to account for NCI effects) to account for the inter-entity transactions in the consolidated financial statements of Michelangelo at 30 June 2020. Q8 Consolidation 24 Points The following information is relevant to question 8.1 and 8.2. On 1 July 2019, Leonardo Ltd acquired 80% of the issued shares of Donatello Ltd. At the date of the business combination, Donatello Ltd has an item of plant that has carrying amount of $100,000 and fair value of $130,000. The plant was purchased at cost of $250,000. The plant is depreciated on a straight-line basis and has a further useful life of five years, with no residual value. The plant was sold by Donatello Ltd to external entities on 31 December 2023 for $15,000. The tax rate is 30%. Q8.2 5 Points Prepare the consolidation journal entries relating to plant for the consolidated financial statements of Leonardo Ltd (including any entries relating to NCI) at 30 June 2024. Please select file(s) Select file(s) Q8.3 16 Points On 1 July 2015, Michelangelo Ltd acquired 75% of the issued shares of Rafael Ltd. At the date of the business combination the following information was relevant in relation to inter-entity transactions between Michelangelo and Rafael: • At 30 June 2019, inventories of Michelangelo included assets sold to it by Rafael for a before-tax profit of $1,200. These items were sold to external entities during the year ended 30 June 2020. On 1 January 2020, Rafael sold plant to Michelangelo for a before-tax profit of $4,800. The carrying amount of the plant was $12,000 at the time of sale (original cost $80,000). The plant was depreciated on a straight-line basis and had a further useful life of five years, with no residual value. . During the year ended 30 June 2020, Rafael had sold inventories to Michelangelo for $120,000. The mark-up on sales was 25% on cost. At 30 June 2020, Michelangelo still had some of these inventories on hand, amounting to items acquired from Rafael for $12,000. Michelangelo Ltd uses partial goodwill method. Q8.3 16 Points On 1 July 2015, Michelangelo Ltd acquired 75% of the issued shares of Rafael Ltd. At the date of the business combination the following information was relevant in relation to inter-entity transactions between Michelangelo and Rafael: At 30 June 2019, inventories of Michelangelo included assets sold to it by Rafael for a before-tax profit of $1,200. These items were sold to external entities during the year ended 30 June 2020. . On 1 January 2020, Rafael sold plant to Michelangelo for a before-tax profit of $4,800. The carrying amount of the plant was $12,000 at the time of sale (original cost $80,000). The plant was depreciated on a straight-line basis and had a further useful life of five years, with no residual value. . During the year ended 30 June 2020, Rafael had sold inventories to Michelangelo for $120,000. The mark-up on sales was 25% on cost. At 30 June 2020, Michelangelo still had some of these inventories on hand, amounting to items acquired from Rafael for $12,000. Michelangelo Ltd uses partial goodwill method. Required: Prepare the consolidation journal entries (including any necessary entries to account for NCI effects) to account for the inter-entity transactions in the consolidated financial statements of Michelangelo at 30 June 2020.

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