Summer plc acquired 60% of the common shares of Winter Ltd on 30 September 20X1 and gained control. At the date of acquisition, the balance of retained ear nings of Winter was £35,000.

At 31 December 20X1 the balance sheets of the two companies were as follows:

Notes:
1. The fair value is the same as the book value.

2. There have been no movements on share capital since 30/9/20X1.
3. 8.33% of the goodwill is to be written off as an impairment loss.
Required:
Prepare a consolidated balance sheet for Summer plc as at 31 December 20X1.

Transcribed Image Text:

Summer Winter 000 000 ASSETS Non-current assets Property, plant and equipment 200 200 Investment in Winter 141 Current assets 100 140 Total assets 441 340 EQUITY AND LIABILITIES Equity shares 200 180 Retained earnings 161 40 361 220 Current liabilities 80 120 Total equity and liabilities 441 340