At the start of business on 1 January 2018, the statements of financial position of A1 Ltd and A2 Ltd were as follows:

On 1 January 2018, A1 Ltd acquired 100% of the share capital of A2 Ltd for ?225,000. The fair value of A2 Ltd's non-current assets on that date was ?150,000. All other assets and liabilities were shown at fair value in the company's statement of financial position. There were no other transactions on 1 January 2018.

Required:

(a) Prepare a consolidated statement of financial position as at the close of business on 1 January 2018, assuming that the purchase consideration of ?225,000 was paid in cash.

(b) Prepare a consolidated statement of financial position as at the close of business on 1 January 2018, now assuming that the purchase consideration of ?225,000 was settled by means of an issue of 150,000 ?1 ordinary shares in A1 Ltd at a premium of 50p per share.

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A2 Ltd £000 Al Ltd £000 Assets 510 Non-current assets Current assets 125 325 75 835 200 Equity Ordinary share capital Retained earnings 500 100 185 685 160 Liabilities Current liabilities 150 40 835 200 88|8 9|8