Prepare the consolidated statement of profit or loss for Gandolf plc for the year ended 30 June
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Prepare the consolidated statement of profit or loss for Gandolf plc for the year ended 30 June 2021. You should show your workings.
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Extracts from the draft individual financial Gandolf plc and its subsidiary for the year ended 30 June 2021 are shown below: Statement of profit or loss for the year ended 30 June 2021 (extract) Gandolf plc Bilbi Ltd 30,252,500 (17,010,600) (6,903,400) 13,241,900 (7,625,300) 5,616,600 Revenue 10,151,000 Cost of sales Gross profit Operating expenses Profit from operations 3,247,600 (1,044,400) 2,203,200 Investment income 400,000 6,016,600 (1,534,000) 4,482,600 58,000 2,261,200 (616,000) 1,645,200 Profit before tax Тах expenseе Profit for the year The following information is also relevant: (1) On 1 March 2021, Gandolf plc gained control over Bilbi Ltd by acquiring 750,000 ordinary shares with a nominal value of 50p per share. Gandolf plc paid £4 million cash and issued 8 million ordinary 25 pence shares at a market value of 85 pence per share. Bilbi Ltd had the following statement of financial position balances at 1 July 2020: Share capital (50p ordinary shares) Share premium Retained earnings 500,000 1,200,000 6,320,400 At 1 March 2021, the fair values of the net assets of Bilbi Ltd were the same as their carrying amounts with the exception of a building that had a fair value of £90,000 in excess of its carrying amount. At that time the building had a remaining useful life of 30 years. All depreciation charges are presented as operating expenses. Gandolf plc measures the non-controlling interest using the proportionate share of net assets. (2) On 1 April 2021, Gandolf plc sold a machine to Bilbi Ltd for £420,000. The machine was originally bought Gandolf plc three years ago on 1 April Extracts from the draft individual financial Gandolf plc and its subsidiary for the year ended 30 June 2021 are shown below: Statement of profit or loss for the year ended 30 June 2021 (extract) Gandolf plc Bilbi Ltd 30,252,500 (17,010,600) (6,903,400) 13,241,900 (7,625,300) 5,616,600 Revenue 10,151,000 Cost of sales Gross profit Operating expenses Profit from operations 3,247,600 (1,044,400) 2,203,200 Investment income 400,000 6,016,600 (1,534,000) 4,482,600 58,000 2,261,200 (616,000) 1,645,200 Profit before tax Тах expenseе Profit for the year The following information is also relevant: (1) On 1 March 2021, Gandolf plc gained control over Bilbi Ltd by acquiring 750,000 ordinary shares with a nominal value of 50p per share. Gandolf plc paid £4 million cash and issued 8 million ordinary 25 pence shares at a market value of 85 pence per share. Bilbi Ltd had the following statement of financial position balances at 1 July 2020: Share capital (50p ordinary shares) Share premium Retained earnings 500,000 1,200,000 6,320,400 At 1 March 2021, the fair values of the net assets of Bilbi Ltd were the same as their carrying amounts with the exception of a building that had a fair value of £90,000 in excess of its carrying amount. At that time the building had a remaining useful life of 30 years. All depreciation charges are presented as operating expenses. Gandolf plc measures the non-controlling interest using the proportionate share of net assets. (2) On 1 April 2021, Gandolf plc sold a machine to Bilbi Ltd for £420,000. The machine was originally bought Gandolf plc three years ago on 1 April
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Related Book For
Accounting
ISBN: 978-1118608227
9th edition
Authors: Lew Edwards, John Medlin, Keryn Chalmers, Andreas Hellmann, Claire Beattie, Jodie Maxfield, John Hoggett
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