Pasir Sdn Bhd acquired 80% of the ordinary shares in Bukit Sdn Bhd on 1 January...

  

Transcribed Image Text:

Pasir Sdn Bhd acquired 80% of the ordinary shares in Bukit Sdn Bhd on 1 January 2018, when Bukit Sdn Bhd's retained earnings were RM3,000,000. On 1 January 2018, Bukit Sdn Bhd acquired 80% of ordinary shares in Gambir Sdn Bhd when Gambir Sdn Bhd's retained earnings were RM1,000,000. The non-controlling interest and goodwill arising on the acquisition of subsidiaries were both calculated using the proportionate method. The financial statements of three companies in a group for the year 2021 are as follows: Statements of profit or loss for the year ended 31 December 2021 Revenue Cost of sales Gross profit Operating expenses Profit before tax Tax Profit after tax Pasir Sdn Bhd RM'000 200,000 (100,000) 100,000 (50,000) 50,000 (14,000) 36,000 Bukit Sdn Bhd RM'000 20,000 (15,500) 4,500 (2,000) 2,500 (525) 1,975 Gambir Sdn Bhd RM'000 10,000 (4,500) 5,500 (1,500) 4,000 (850) 3,150 Statements of Changes in Equity (partial) for the year ended 31 December 2021 Pasir Sdn Bukit Sdn Gambir Sdn Bhd Bhd Bhd Beginning retained earnings Profit for the year Dividend Ending retained earnings Statements of Financial Position on 31 December 2021 Pasir Sdn Bhd Ordinary shares Retained earnings Other liabilities Total Equity and Liabilities Investment in Bukit Sdn Bhd Investment in Gambir Sdn Bhd Other assets Total Assets RM'000 40,000 36,000 (8,000) 68,000 RM'000 40,000 68,000 39,500 147,500 40,000 (b) 107,500 147,500 RM'000 4,000 1,975 0 5,975 Bukit Sdn Bhd RM'000 8,000 5,975 1,320 15,295 8,000 7,295 15,295 RM'000 2,000 3,150 0 5,150 Gambir Sdn Bhd RM'000 3,000 5,150 1,020 9,170 9,170 9,170 There was an impairment loss allowance of RM500,000 written off in 2020 arising from the acquisition of Bukit Sdn Bhd. There is no impairment loss allowance arising from the acquisition of Gambir Sdn Bhd. The group starts to sell to each other in 2021 at a cost plus 25%. During the year 2021, Bukit Sdn Bhd sold RM2,000,000 worth of goods to Pasir Sdn Bhd. On 31 December 2021, RM1,000,000 of these goods were still in the ending inventory of Pasir Sdn Bhd. Required: (a) Identify the indirect interest in the subsidiary, prepare the consolidated statement of profit or loss of Pasir Sdn Bhd and its subsidiaries for the year ended 31 December 2021. (12 marks) Identify the indirect interest in the subsidiary, prepare the consolidated statement of financial position of Pasir Sdn Bhd and its subsidiaries 31 December 2021. (13 marks) Pasir Sdn Bhd acquired 80% of the ordinary shares in Bukit Sdn Bhd on 1 January 2018, when Bukit Sdn Bhd's retained earnings were RM3,000,000. On 1 January 2018, Bukit Sdn Bhd acquired 80% of ordinary shares in Gambir Sdn Bhd when Gambir Sdn Bhd's retained earnings were RM1,000,000. The non-controlling interest and goodwill arising on the acquisition of subsidiaries were both calculated using the proportionate method. The financial statements of three companies in a group for the year 2021 are as follows: Statements of profit or loss for the year ended 31 December 2021 Revenue Cost of sales Gross profit Operating expenses Profit before tax Tax Profit after tax Pasir Sdn Bhd RM'000 200,000 (100,000) 100,000 (50,000) 50,000 (14,000) 36,000 Bukit Sdn Bhd RM'000 20,000 (15,500) 4,500 (2,000) 2,500 (525) 1,975 Gambir Sdn Bhd RM'000 10,000 (4,500) 5,500 (1,500) 4,000 (850) 3,150 Statements of Changes in Equity (partial) for the year ended 31 December 2021 Pasir Sdn Bukit Sdn Gambir Sdn Bhd Bhd Bhd Beginning retained earnings Profit for the year Dividend Ending retained earnings Statements of Financial Position on 31 December 2021 Pasir Sdn Bhd Ordinary shares Retained earnings Other liabilities Total Equity and Liabilities Investment in Bukit Sdn Bhd Investment in Gambir Sdn Bhd Other assets Total Assets RM'000 40,000 36,000 (8,000) 68,000 RM'000 40,000 68,000 39,500 147,500 40,000 (b) 107,500 147,500 RM'000 4,000 1,975 0 5,975 Bukit Sdn Bhd RM'000 8,000 5,975 1,320 15,295 8,000 7,295 15,295 RM'000 2,000 3,150 0 5,150 Gambir Sdn Bhd RM'000 3,000 5,150 1,020 9,170 9,170 9,170 There was an impairment loss allowance of RM500,000 written off in 2020 arising from the acquisition of Bukit Sdn Bhd. There is no impairment loss allowance arising from the acquisition of Gambir Sdn Bhd. The group starts to sell to each other in 2021 at a cost plus 25%. During the year 2021, Bukit Sdn Bhd sold RM2,000,000 worth of goods to Pasir Sdn Bhd. On 31 December 2021, RM1,000,000 of these goods were still in the ending inventory of Pasir Sdn Bhd. Required: (a) Identify the indirect interest in the subsidiary, prepare the consolidated statement of profit or loss of Pasir Sdn Bhd and its subsidiaries for the year ended 31 December 2021. (12 marks) Identify the indirect interest in the subsidiary, prepare the consolidated statement of financial position of Pasir Sdn Bhd and its subsidiaries 31 December 2021. (13 marks)

Answer rating: 100% (QA)

Ans 1 Pasin Sdn Bhd shares in Bukit Sdn Bhd 80 x Bukit Sdn Bhd Shaus in Gambir ... View the full answer