Exercise 21.4 ★ BUSINESS COMBINATION VALUATION AND PRE-ACQUISITION ENTRIES On 1 July 2013, Pyxis Ltd acquired all the share capital of Gemini Ltd for £218 500. At this date, Gemini Ltd’s equity comprised: Share capital — 100 000 shares General reserve Retained earnings £100 000 50 000 36 000 All identifi able assets and liabilities of Gemini Ltd were recorded at fair value as at 1 July 2013 except for the following: Carrying amount Fair value Inventory Land Equipment (cost £100 000) £27 000 75 000 50 000 £35 000 90 000 60 000 The equipment is expected to have a further 10-year life. All the inventory was sold by June 2014. The tax rate is 30%. On 30 June 2014, the directors of Gemini Ltd decided to transfer £25 000 from the general reserve to retained earnings. Required Prepare the consolidation worksheet entries for the preparation of consolidated fi nancial statements for Pyxis Ltd and its subsidiary Gemini Ltd as at: 1. 1 July 2013 2. 30 June 2014.