Question 1 As at 31 December x5 the statement of financial position of Span and Cat...
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Question 1 As at 31 December x5 the statement of financial position of Span and Cat was as follows: Ordinary shares of RM10 each Ordinary shares of RM1 each 7% preference shares of RM1 each 5.6% preference shares of RM1 each Accumulated profit Current liabilities: Taxation Current account - Span Dividend payables Trade payables Land at cost Plant and machinery Accumulated depreciation Investment in Cat - 150,000 shares Current Assets: Dividend receivable from Cat Current account Cat Trade receivables Inventories Bank Span RM'000 400,000 100,000 100,000 28,000 25,000 23,000 676,000 200,000 150,000 -50,000 250,000 9,600 12,000 28,000 45,000 31.400 676.000 Cat RM'000 200,000 100,000 70,000 21,400 11,000 15,600 33,000 451,000 300,000 60,000 -20,000 32,000 41,000 38.000 451,000 You ascertain the following: 1. Span acquired the ordinary shares of Cat on 1 January x3 when the retained profit of Cat had a negative balance of RM20 million. 2. On 1 January x3 the fair value of land of Cat was RM100 million more than shown in the books. Cat did not adjust its book to reflect the new value. The piece of land still remains in Cat. 3. During the year ended 31 December x5, Cat sold inventories valued at RM30 million to Span. Cat invoices trading inventories to Span at cost plus 50%. At 31 December x5 Span had not sold any of these inventories. 4. During the year ended 31 December x4, Span sold to Cat plant and machinery (cost RM40 million less accumulated depreciation RM20 million) at RM30 million. The remaining economic life of this asset is five years and the plant is depreciated using the straight-line method. 5. Span's bank has not credited its account for the RM1 million cash remitted by Cat on 31 December x5. 6. Dividends payable of Cat include second-half year's preference dividends. You are required to prepare the consolidated statement of financial position of Span group as at 31 December x5. (Total 25 marks) Question 1 As at 31 December x5 the statement of financial position of Span and Cat was as follows: Ordinary shares of RM10 each Ordinary shares of RM1 each 7% preference shares of RM1 each 5.6% preference shares of RM1 each Accumulated profit Current liabilities: Taxation Current account - Span Dividend payables Trade payables Land at cost Plant and machinery Accumulated depreciation Investment in Cat - 150,000 shares Current Assets: Dividend receivable from Cat Current account Cat Trade receivables Inventories Bank Span RM'000 400,000 100,000 100,000 28,000 25,000 23,000 676,000 200,000 150,000 -50,000 250,000 9,600 12,000 28,000 45,000 31.400 676.000 Cat RM'000 200,000 100,000 70,000 21,400 11,000 15,600 33,000 451,000 300,000 60,000 -20,000 32,000 41,000 38.000 451,000 You ascertain the following: 1. Span acquired the ordinary shares of Cat on 1 January x3 when the retained profit of Cat had a negative balance of RM20 million. 2. On 1 January x3 the fair value of land of Cat was RM100 million more than shown in the books. Cat did not adjust its book to reflect the new value. The piece of land still remains in Cat. 3. During the year ended 31 December x5, Cat sold inventories valued at RM30 million to Span. Cat invoices trading inventories to Span at cost plus 50%. At 31 December x5 Span had not sold any of these inventories. 4. During the year ended 31 December x4, Span sold to Cat plant and machinery (cost RM40 million less accumulated depreciation RM20 million) at RM30 million. The remaining economic life of this asset is five years and the plant is depreciated using the straight-line method. 5. Span's bank has not credited its account for the RM1 million cash remitted by Cat on 31 December x5. 6. Dividends payable of Cat include second-half year's preference dividends. You are required to prepare the consolidated statement of financial position of Span group as at 31 December x5. (Total 25 marks)
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Related Book For
Financial Accounting
ISBN: 978-1118978085
IFRS 3rd edition
Authors: Jerry J. Weygandt, Paul D. Kimmel, Donald E. Kieso
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