Summer plc acquired 60% of the common shares of Winter Ltd on 30 September 20X1 and gained control. At the date of acquisition, the balance of retained earnings of Winter was £35,000. At 31 December 20X1 the statements of financial position of the two companies were as follows:

Notes:
1 The fair value of the non-controlling interest at the date of acquisition was £92,000. The non-controlling interest is to be measured using method 2. The fair values of the identifiable net assets of Winter at the date of acquisition were the same as their book values.
2 There have been no movements on share capital since 30/9/20X1.
3 16.67% of the goodwill is to be written off as an impairment loss.

Required:
Prepare a consolidated statement of financial position for Summer plc as at 31 December20X1.

Transcribed Image Text:

Winter E000 Summer ASSETS Non-current assets Property, plant and equipment Investment in Winter Current assets Total assets 200 200 100 441 140 340 EQUITY AND LIABILITIES Equity shares Retained earnings 200 161 361 80 441 180 40 220 120 340 Current liabilities Total equity and liabilities