Question $2(30$ marks$)$

On January $1,2021,$ Giselle Corporation $($Giselle$)$ acquired a $75\%$ stake in Heather Limited $($Heather$),$ thereby gaining the control of Heather. An appraisal on that date revealed that the book values of Heather's underlying accounts accurately reflected their fair values, except for one piece of equipment, which was understated by $$176,000.$ This equipment had been purchased on January $1,2017,$ for $$705,000$ and had a carrying amount of $$517,000$ as of January $1,2021.$ It is expected to have a remaining useful life of $11$ years.

On April $1,2022,$ Giselle transferred a piece of land to Heather for $$2,720,000.$ Giselle had originally purchased the land on January $1,2020,$ for $$2,400,000.$ Both Giselle and Heather account for their land using the cost method. On October $1,2023,$ Heather sold the land to an external party for $$2,640,000.$

On January $1,2023,$ a factory building with a carrying amount of $$2,120,000$ was transferred from Heather to Giselle for $$2,607,500.$ At the time of the transfer, the building's remaining useful life was assessed at $15$ years, with a residual value of $$170,000.$ Heather had originally purchased the building on July $1,2015,$ for $$3,320,000.$ When it was first purchased, the estimated useful life of

the building was $20$ years, with a residual value of $$120,000.$ Giselle and Heather account for their property, plant, and equipment using the cost approach and apply the straight$-$line method for depreciation. Each company reports both the cost of the asset and its accumulated depreciation in their respective statements of financial position.

Giselle is currently preparing its consolidated financial statements for the year ended December $31,2023.$ The following shows the extract of the prepared consolidated income statement:

$\backslash$table$[[$Consolidated Net Income,$1,234,500$