12.3 Gieves Ltd purchased 80 per cent of the shares in Hawkes Ltd on 31 December 20X6. The summarised balance sheets of the companies at 31 December 20X7 were as follows:

Gieves Ltd Hawkes Ltd

£000

£000

£000

£000 Fixed assets 255,000 170,000 Investment in Hawkes Ltd 160,000 Current assets:

Stock 22,000 22,000 Debtors 23,000 20,000 Cash 15,000 10,000 60,000 52,000 Less: Current liabilities 45,000 32,000 Net current assets 15,000 20,000 430,000 190,000 Long-term liabilities 50,000

—

380,000 190,000 Share capital 250,000 100,000 General reserve 80,000 60,000 Profit and loss account 50,000 30,000 380,000 190,000 At the date Gieves Ltd purchased the shares in Hawkes Ltd, the balances on the revenue reserve accounts of Hawkes Ltd were as follows:

General reserve £50,000,000 Profit and loss account £20,000,000 Required:

Prepare a consolidated balance sheet as at 31 December 20X7.