The information below relates to Highflyer Ltd and Lowflyer Ltd. On 30 June 2021, Highflyer Ltd...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
The information below relates to Highflyer Ltd and Lowflyer Ltd. On 30 June 2021, Highflyer Ltd acquired all of the issued shares of Lowflyer Ltd for $345,000. At the acquisition date the equity of Lowflyer Ltd consisted of: Share capital $135,000 Reserves 115,000 Retained earnings 80,000 At the date of acquisition this equity reflected the fair values of all the identifiable assets and liabilities of Lowflyer Ltd with the exception of Inventory which had a fair value $3,000 greater than its carrying amount. The corporate tax rate is 32%. Required: Prepare an analysis of the situation and also prepare the 30 June 2021 consolidation journal entries (with narrations) that are relevant to the above transactions and events for the books/records of the parent company. a) (9 marks) On 30 June 2021, the drafted individual financial statements of both companies are given as below. Based on the adjustment entries you have provided, (13 marks) b) complete the consolidation worksheet for 30 June 2021 provided below. Note to students: please fill in this worksheet provided in the answer. The information below relates to Highflyer Ltd and Lowflyer Ltd. On 30 June 2021, Highflyer Ltd acquired all of the issued shares of Lowflyer Ltd for $345,000. At the acquisition date the equity of Lowflyer Ltd consisted of: Share capital $135,000 Reserves 115,000 Retained earnings 80,000 At the date of acquisition this equity reflected the fair values of all the identifiable assets and liabilities of Lowflyer Ltd with the exception of Inventory which had a fair value $3,000 greater than its carrying amount. The corporate tax rate is 32%. Required: Prepare an analysis of the situation and also prepare the 30 June 2021 consolidation journal entries (with narrations) that are relevant to the above transactions and events for the books/records of the parent company. a) (9 marks) On 30 June 2021, the drafted individual financial statements of both companies are given as below. Based on the adjustment entries you have provided, (13 marks) b) complete the consolidation worksheet for 30 June 2021 provided below. Note to students: please fill in this worksheet provided in the answer.
Expert Answer:
Answer rating: 100% (QA)
As per IFRS 3 Business Combinations an entity shall measure the net assets acquired in a business co... View the full answer
Related Book For
Accounting Business Reporting for Decision Making
ISBN: 9780730302414
4th edition
Authors: Jacqueline Birt, Keryn Chalmers, Albie Brooks, Suzanne Byrne, Judy Oliver
Posted Date:
Students also viewed these accounting questions
-
The information below relates to Ilall Company: Net income ...........................$ 280,000 Dividends .................................105,000 Total stockholders' equity ...3,900,000 Market value...
-
The information below relates to Milton Company's trading debt securities in 2017 and 2018. Prepare the journal entries for the following transactions. a). January 1, 2017 Purchased $400,000 par...
-
The information below relates to Berkeley Engineering Pty Ltd for the year ended 30th June 2013. Required: From the above information prepare a classified statement of cash flow for Berkeley...
-
Select appropriate letter to each of its related definition in the list given below. Definition A. Economic resources to be used or turned into cash within one year. B. Reports assets, liabilities,...
-
Concerning the pH of the environment and of the cell, in what ways are acidophiles and alkaliphiles different? In what ways are they similar?
-
A flexible connection consisting of rubber pads (thickness t = 9 mm) bonded to steel plates is shown in the figure. The pads are 160 mm long and 80 mm wide. (a) Find the average shear strain...
-
a. Assume that \(y_{1}, \ldots, y_{n}\) are i.i.d. with a negative binomial distribution with parameters \(r\) and \(p\). Determine the maximum likelihood estimators. b. Use the sampling mechanism in...
-
Logistics Consultants Inc. (LCI) provides various logistics analysis services to other firms, including facility location decisions. It has just completed a project for a major customer, but on the...
-
Use the transaction information provided for Mike's Motors (the previous question) to create a balance sheet for Mike's Motors. Make sure to include every account that you used in the journal entries...
-
Jackson's Vacuum company makes two types of vacuums: Basic and Advanced. The factory is set up into 3 working departments. Both vacuums utilize process #1 to assemble the basic components. Those...
-
Explain how legislated wages in lieu of notice are treated for statutory deduction purposes in all jurisdictions in Canada. Legislated wages in lieu of notice outside Quebec (employment income) and...
-
Moving to another question will save this response. Question 6
-
Elucidate the mechanistic role of dynein in inducing the bending motion of cilia and flagella, as well as facilitating the intracellular transport of organelles and vesicles within a cellular context.
-
In 2015, Joseph and Shelbie acquire real estate for $2,000,000, with Joseph furnishing $400,000 of the purchase price and Shelbie providing the balance. Title to the property is listed as: "Joseph...
-
Linda bough 500 CIBC shares worth of $10000 on April 1st in her son's name. her son brad is 16 years old, CIBC pays $2000 (eligible) dividend income every year. Who should report dividend income?...
-
Answers should be brief and concise. Philippine Tax Law 4. A sales employee working for a domestic corporation uses his personal car to visit the customers of the corporation. One day, the employee...
-
Question 4: Use best first search to get to the goal I from A Explain the open and closed lists and write the final path. E G 5 QO
-
4. Jobe dy -Y 2 et by
-
a) Explain the nature of the following items and how they are increased or decreased: i) Paid-up capital. ii) Retained profits. b) Explain the meaning of: i) Intangible assets . ii) The difference...
-
Explain the difference between a full product cost and an inventoriable product cost.
-
Ryans Music provides individual music lessons in the homes of clients. The following data are provided with respect to the last 12 months of activity ending 30 June 2013. Lesson selling price*...
-
A concave mirror of focal length forms an image of the moon. Where is the image located? A. At the mirror's surface B. Almost exactly a distance behind the mirror C. Almost exactly a distance in...
-
During a solar eclipse, the sun-a small but extended source-casts a shadow of the moon on the earth. Explain why the moon's shadow has a dark center surrounded by a region of increasing brightness.
-
A concave mirror brings the sun's rays to a focus at a distance of \(30 \mathrm{~cm}\) from the mirror. If the mirror were submerged in a swimming pool, would the sun's rays be focused nearer to,...
Study smarter with the SolutionInn App