Alpha plc paid 1,480 to acquire 2,400 shares in Beta plc. On the date of acquisition Beta

Question:

Alpha plc paid £1,480 to acquire 2,400 shares in Beta plc. On the date of acquisition Beta plc had an accumulated loss of £180, though its property, plant and equipment had a fair value which exceeded the book value by £200. However, the development costs reported at £40 on that date failed to meet Alpha group’s capitalisation criteria. On the date of acquisition by Alpha, Beta’s shares were quoted at 140p each. You are further informed as follows:

(a) Trade payables reported by Alpha includes £196 owed to Beta; whereas Beta’s books report that an amount of £206 is due from Alpha. Inquiries reveal that Beta has not been informed of £10 charged by Alpha on Beta as management services fees for the year.

(b) Inventory reported by Alpha includes goods invoiced to it at £125 by Beta. Beta invoices Alpha at cost plus 25%.

(c) Though Beta continues to capitalise its development cost the amounts capitalised still fail to meet the group’s capitalisation criteria.

(d) Included within Alpha’s receivables is £250 it paid when acquiring at par 8% Loan notes issued by Beta. The current year’s interest on the loan notes has already been accounted for by both companies. An amount of £170 (including £20 interest for the current year) remains in transit.

(e) Based on fair valuation Beta should have depreciated its property, plant and equipment by £8 in each of the five post-acquisition years until 31 December 2012.

(f) Dividend receivable from Beta has been accounted for in Alpha’s books.

Required:

Prepare the Consolidated Statement of financial position as at 31 December 2012.