Liu Company purchased all the outstanding ordinary shares of Yang Plastics, Ltd. One December 31, 2011. Just before the purchase, the condensed statement of financial position of the two companies appeared as follows.

Liu used current assets of Y1,225,000 to acquire the shares of Yang Plastics. The excess of this purchase price over the book value of Yang Plastics€™ net assets is determined to be attributable Y86,000 to Yang Plastics€™ plant and equipment and the remainder to goodwill.

Instructions
(a) Prepare the entry for Liu€™s acquisition of Yang Plastics, Ltd, shares.
(b) Prepare a consolidated worksheet at December 31, 2011.
(c) Prepare a consolidated statement of financial position at December 31,2011.

Transcribed Image Text:

Liu Company Y2.100.000 1480,000 Y3,580.000 Y1.950,000 1,052.000 Yang Plasties, Ltd Plant and equipment (net) Current assets ¥ 676.000 435.500 Y111.500 Y 525,000 494.000 92,500 Y.500 Share capital-ordinary Retained earnings Current liabilities 578,000 ¥3.580.000