Comparative figures and notes to the consolidated financial statements are not

Comparative figures and notes to the consolidated

This preview shows page 36 - 40 out of 57 pages.

Comparative figures and notes to the consolidated financial statements are not required.
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FAC3704/102 37 SOLUTION 5 (SUGGESTED SOLUTION) PART A MUMBAI LTD GROUP CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME FOR THE YEAR ENDED 28 FEBRUARY 20.17 R Gross profit 1 Other income 2 Other expenses 3 Share of profit of associate(C3) Finance charges (10 000 – 10 000(100 000 x 10%)(int)) 374 925 19 100 (115 130) 37 354 - Profit before tax 316 249 Income tax expense 4 (84 419) PROFIT FOR THE YEAR 231 830 Other comprehensive income for the year TOTAL COMPREHENSIVE INCOME FOR THE YEAR 231 830 Total comprehensive income attributable to: Owners of the parent 5 Non-controlling interests 6 184 684 47 146 231 830 1 183 525 + 195 000 – 3 600(18 000 x 25 / 125 ) = 374 925 2 54 500 – 7 000(mgt fee) – 10 000(100 000 x 10%)(int) – 12 000(20 000 x 60%)(div) – 6 400(16 000 x 40%)(div) = 19 100 3 96 630 + 21 300 – 7 000(mgt fee) + 4 200(impairment) = 115 130 4 39 591 + 45 836 – 1 008(3 600 x 28%) = 84 419 5 231 830(profit for the year) – 47 146 6 (NCI) = 184 684 6 117 864(195 000 – 31 300 – 45 836) x 40% = 47 146 PART B MUMBAI LTD GROUP CONSOLIDATED STATEMENT OF CHANGES IN EQUITY FOR THE YEAR ENDED 28 FEBRUARY 20.17 Share capital R Retained earnings R Total R Non- controlling interests R Total equity R Balance at 1 March 20.16 Changes in equity for 20.17 Total comprehensive income for the year: Profit for the year Dividends 525 000 547 015 1 184 684 (80 000) 1 072 015 184 684 (80 000) 1 320 2 47 146 (8 000) 1 073 335 231 830 (88 000) Balance at 28 February 20.17 525 000 651 699 1 176 699 40 466 1 217 165 1 497 335 + 21 180 + 22 500((101 250 – 45 000) x 40%) + 6 000 (gain) = 547 015 2 (12 800) + 14 120 = 1 320
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38 QUESTION 5 (SUGGESTED SOLUTION)(continued) CALCULATIONS C1 Profit for the year R Gross profit Other expenses Finance charges Income tax expense 195 000 (21 300) (10 000) (45 836) 117 864 C2 Analysis of owner’s equity of Delhi Ltd 100% Mumbai Ltd 60% 40% Total R At R Since R NCI R At acquisition Share capital Accumulated loss 90 000 (122 000) 54 000 (73 200) 36 000 (48 800) Equity represented by goodwill (32 000) 24 200 (19 200) 24 200 (12 800) - Consideration paid and NCI (7 800) 5 000 (12 800) Since acquisition Retained earnings (86 700 – 122 000) 35 300 21 180 k 14 120 27 500 21 180 1 320 Current year Profit for the year (C1) 117 864 70 718 47 146 Dividends paid (20 000) (12 000) (8 000) 125 364 24 200 79 898 40 466 Impairment of goodwill Current year (24 200 – 20 000) (4 200) Carrying amount at 28 February 20.17 20 000 C3 Analysis of owner’s equity of Jaipur Ltd 100% Mumbai Ltd 40% 40% At acquisition Total R At R Since R CA R Share capital Retained earnings 75 000 45 000 30 000 18 000 Equity represented by gain on bargain purchase 120 000 (6 000) 48 000 (6 000) Consideration paid 42 000 42 000 Since acquisition Gain on bargain purchase 6 000 6 000 1 6 000 Retained earnings (101 250 – 45 000) 56 250 22 500 22 500 Current year Profit for the year (189 000 – 54 300 – 5 000 – 36 316) 93 384 37 354 37 354 Dividends (16 000) (6 400) (6 400) 253 634 59 454 101 454 1 Included in opening retained earnings as acquisition took place on 1 March 20.14, therefore in the period since acquisition to beginning of the current year.
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FAC3704/102 39 QUESTION 5 (SUGGESTED SOLUTION)(continued) (The statement of financial position was not required in the question; it has been included for tuition purposes only) MUMBAI LTD GROUP CONSOLIDATED STATEMENT OF FINANCIAL POSITION AS AT 28 FEBRUARY 20.17 ASSETS R Non-current assets Property, plant and equipment (460 200 + 162 000) Loan to associate Investment in associate (C3) Other equity investments Goodwill (C2)
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