On 1 June 2019, Master meats Nigeria sold products costing 1,080,000,000 Nigerian Naira (NGN) to Zambeef
PLC (parent company) at a mark-up of 20%. Zambeef PLC made a part payment of 80, 000,000NGN on July 1
2019 and the balance on 31 March 2020. Zambeef PLC was still holding half of these goods in its inventory at the
year.
Exchange rates were as follows.
(1ZMW =35NGN on 1 June 2019, 1ZMW=40NGN on July 1 2019, 1ZMW=29.1NGN on 30 September 2019,
1ZMW= 28NGN on December 2019 and 1ZMW = 27 NGN on 31 March 2019).This transaction has been omitted
in the books of both Master meats Nigeria and Zambeef PLC.
Required
i) Prepare the journal entries that would have been made by Master meats Nigeria and Zambeef PLC. On
June 1, 2019 and on July 1 2019
ii) State the ledger accounts in the above consolidated statement of financial position that will be affect
once the above sales transaction is updated, and explain by how much the said accounts will increase or decrease V) Prepare a new group statement of financial position (for the year 2019 only) after taking in account the
adjustments made in (a) and (b) above
The following exchange rates have been applied:
ZMW: USD Average exchange
rate
Closing exchange
rate
Year ended 30 September 2018 9.92 12.24
Year ended 30 September 2019 12.32 13.20

Consolidated Statement of Financial Position For the year ended 30 September 2019
2019 2019 2018 2018
ASSETS Note ZMW’000s USD’000s ZMW’000s USD’000s
Non-current assets
Goodwill 13 166,801 12,636 166,801 13,628
Property, plant and equipment 14 2,841,824 215,290 2,902,221 237,110
Investment in associate 15(e) 12,376 938 15,412 1,259
Deferred tax asset 10(e) 56,525 4,282 47,854 3,910
3,077,526 233,146 3,132,288 255,907
Current assets
Biological assets 16 170,417 12,910 181,674 14,843
Inventories 17 941,159 71,300 639,811 52,272
Trade and other receivables 18 98,025 7,426 156,314 12,771
Assets held for disposal 34 135,357 10,254 - -
Amounts due from related companies 19 41,554 3,148 50,272 4,107
Income tax recoverable 10(c) 2,767 210 3,885 317
1,389,279 105,248 1,031,956 84,310
Total assets 4,466,805 338,394 4,164,244 340,217
EQUITY AND LIABILITIES
Capital and reserves
Share capital 21 3,006 449 3,006 449
Preference share capital 21 1,000 100 1,000 100
Share premium 22 1,125,012 185,095 1,125,012 185,095
Other reserves 2,116,691 60,243 1,986,756 68,916
3,245,709 245,887 3,115,774 254,560
Non-controlling interest (4,881) (370) (8,660) (708)
3,240,828 245,517 3,107,114 253,852
Consolidated Statement of Financial Position (continued)
For the year ended 30 September 2019
2019 2019 2018 2018
Note ZMW’000s USD’000s ZMW’000s USD’000s
Non-current liabilities
Interest bearing liabilities 23 228,099 17,280 308,312 25,189
Obligations under finance leases 24 19,297 1,462 20,163 1,647
Deferred liability 25 16,362 1,240 22,611 1,847
Deferred tax liability 10(e) 9,138 692 6,909 565
272,896 20,674 357,995 29,248
Current liabilities
Interest bearing liabilities 23 130,661 9,899 95,247 7,782
Collateral management agreement 23 212,381 16,089 107,213 8,759
Obligations under finance leases 24 21,487 1,628 18,248 1,491
Trade and other payables 26 259,585 19,665 297,390 24,294
Provisions 27 52,914 4,009 42,137 3,443 Amounts due to related companies 28 251 19 232 19
Taxation payable 10(c) 1,377 104 2,925 239
Bank overdrafts 20 274,425 20,790 135,743 11,090
953,081 72,203 699,135 57,117
Total equity and liabilities 4,466,805 338,394 4,164,244 340,217

Answer rating: 100% (QA)

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