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Page16of6504541,280632EquityShare capital $1 ordinary shares500200Reserves310170810370Current liabilitiesTrade payables295171Income tax payable80Provisions954702621,280632No impairment losses have been necessary in the group financial statements to date.Assume that the gain as calculated in the parent's separate financial statements will besubject to corporate income tax at a rate of 30% and that profit and other comprehensiveincome accrue evenly throughout the year.Holmes elected to measure the non-controlling interests in Deakin at fair value at the dateof acquisition.The fair value of the non-controlling interests in Deakin was $45m at the date of acquisition.No control premium was paid on acquisition.RequiredPrepare:(a) The statement of profit or loss and other comprehensive income and a statement ofchanges in equity (total) of Holmes for the year ended 31 May 2019(6 marks)(b) The consolidated statement of profit or loss and other comprehensive income of Holmesfor the same period(7 marks)(c) A consolidated statement of financial position as at 31 May 2019(12 marks)(d) A consolidated statement of changes in equity (total) for the year ended 31 May 2019256031(3marks)QUESTION 6 (25 marks)Shamah Co bought 70% of the share capital of Salem Co for $120,000 on 1 January 2017. Atthat date Shane Co's retained earnings stood at $10,000.The statements of financial position at 31 December 2019, summarised statements of profitor loss and other comprehensive income to that date and movement on retained earningsare given below.Shamah CoSalem Co$'000$'000STATEMENTS OF FINANCIAL POSITIONNon-current assetsProperty, plant and equipment20080
Page17of25Investment in Shane Co12032080Current assets8901401,210220EquityShare capital$1 ordinary shares500Retained reserves400900190Current liabilities3101,210220SUMMARISED STATEMENTS OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME$'000$'000Profit before interest and tax100Income tax expense(40)(8)Profit for the year60Other comprehensive income(not reclassified to P/L)net of tax10Total comprehensive income for the year7018MOVEMENT IN RETAINED RESERVESBalance at 31 December 2018330Total comprehensive income for the year70Balance at 31 December 2019400Shamah Co sells one half of its holding in Salem Co for $120,000 on 30 June 2019. At thatdate, the fair value of the 35% holding in Salem was slightly more at $130,000 due to a shareprice rise. The remaining holding is to be dealt with as an associate. This does not representa discontinued operation. No entries have been made in the accounts for the abovetransaction. Assume that profits accrue evenly throughout the year.It is the group's policy to value the non-controlling interest at acquisition fair value. The fairvalue of the non-controlling interest on 1 January 2017 was $51 400.RequiredPrepare the consolidated statement of financial position, statement of profit or loss andother comprehensive income and a reconciliation of movement in retained reserves for theyear ended 31 December 2019.(25 marks)QUESTION 7 (25 marks)On 1 September 2019 Swing Co acquired 70% of Slide Co for $5,000,000 comprising$1,000,000 cash and 1,500,000 $1 shares.The statement of financial position of Slide Co at acquisition was as follows:100903020126721890
Page18of25$'000Property, plant and equipment2,700Inventories1,600Trade receivables600Cash400Trade payables(300)Income tax payable(200)4,800The consolidated statement of financial position of Swing Co as at 31 December 2019 was as

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Term
Summer
Professor
N/A
Tags
Balance Sheet, Generally Accepted Accounting Principles, Plant Equipment

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