Share Capital 360000 54000 BCVR General Reserve 10000 3000 Total Equity 514000

Share capital 360000 54000 bcvr general reserve 10000

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Share Capital 360,000 54,000 BCVR - - General Reserve 10,000 3,000 Total Equity 514,000 217,300 Trade payables 68,500 32,700 Other current liabilities 215,000 105,000 Deferred Tax Liabilities 2,500 2,000 Provisions 100,000 60,000 Total Liabilities 386,000 199,700 Total Equity and Liabilities 900,000 417,000 Assets Cash at bank 273,500 142,700 Trade receivables 44,000 38,500 Inventories 55,000 18,700 Investment in Doe Ltd 120,000 - Land 150,000 120,000 Plant and machinery 360,000 125,600 Accumulated depreciation - plant and machinery 110,000 33,000 Goodwill - - Deferred Tax Assets 7,500 4,500 Total Assets 900,000 417,000 CA FV Inventories 12,000 16,000 Machinery (cost $100 000) 82,500 94,000 Land 80,000 90,000 Contingent Liability 10,000
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1. Acquisition Analysis Consideration transferred 120,000 FVINA: Share Capital 54,000 Retained Earnings 36,000 BCVR: Inventories 2,800 Machinery 8,050 Land 7,000 Contingent Liability 7,000 100,850 Goodwill 19,150 Note: the lecture slides recognise Goodwill in a separate journal entry rather thLecture slides Dr Goodwill 19,150 Cr BCVR 19,150 Pre-acquisition entry Dr RE (1.7.2018) 36,000 Dr Share Capital 54,000 Dr BCVR 30,000 Cr Investment in Doe Ltd 120,000
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If you combine these two entries together, you get the pre-acquisition entry pre
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DR CR Group 705,000 400 380,400 324,600 35,000 10,000 2,000 18,000 2,300 104,300 37,000 8,000 4,500 231,800 3,000 3,810 59,390 172,410 37,820 690 92,870 14,280 14,280 - - 265,280 54,000 360,000 15,330 15,330 - 3,000 10,000 635,280 101,200 320,000 1,380 3,450 6,570 160,000 587,770 1,223,050 416,200 82,500 73,700 120,000 - 270,000 11,500 17,500 479,600 17,500 4,600 130,100 19,150 19,150 12,000 1,223,050
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Consolidation date: 1.7.2018 (Date of Acquisition) 2. BCVR 3. Pre-acquisition entries Inventories Dr Inventory 4,000 Dr RE (1.7.2018) Cr DTL 1,200 Dr Share Capital Cr BCVR 2,800 Dr BCVR Dr Goodwill Machinery Cr Investment in Doe Ltd Dr Accumulated depreciation 17,500 Cr Machinery 17,500 Dr Machinery 11,500 Cr DTL 3,450 Cr BCVR 8,050 Land Dr Land 10,000 Cr DTL 3,000 Cr BCVR 7,000 Contingent Liability Dr BCVR 7,000 Dr DTA 3,000 Cr Provision for Litigation cost 10,000 han in the pre-acquisition entry. However, this is the same as the solution presented above.
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esented in the solution.
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Consolidation date: 30.6.2019 (1 year after acquisition) 2. BCVR Inventories 36,000 Dr COGS 54,000 Cr ITE 10,850 Cr Transfer from BCVR 19,150 120,000 Dr Inventories Cr DTL Cr BCVR Machinery Dr Accumulated depreciation Cr Machinery Dr Machinery Cr DTL Cr BCVR Dr Depreciation expense Cr Acc. Dep Dr DTL Cr ITE Land Dr Land Cr DTL Cr BCVR Contingent Liability Dr BCVR Dr DTA
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