2 Consolidation with NCI [30 MARKS] Using the information provided below you are required to undertake the consolidation for the group. 5 years 1 July 2010 $8 000 $34 797 8 years $2 000 Hunter Ltd has one subsidiary, Bryan Ltd. Bryan Ltd $000 1 200 800 -------- $2 000 ===== Share capital Ordinary: Held by group Held by other interests Information about the companies for the year ended 30 June 2008 is as follows: Trading profit (loss) Income from investments Profit before tax Page | 2 Hunter Ltd $000 460 340 400 800 1 400 Bryan Ltd $000 1 000 Income tax expense Profit Dividend paid Retained earnings (1/7/07) Retained earnings (30/6/08) Investments Other non-current asset (net) Current assets Total assets Share capital Asset revaluation reserve Retained earnings Total equity Liabilities Total equity and liabilities Additional Information 100 700 500 200 6 800 $7 000 ===== Hunter Ltd $000 3 608 6 000 2 392 $12 000 ===== $1 000 1 000 7 000 9 000 3 000 $12 000 ===== 500 900 500 400 3 600 $4 000 ==== Bryan Ltd $000 3 000 3 000 2 000 $8 000 ===== $2 000 - 4 000 6 000 2 000 $8 000 ===== Hunter Ltd acquired a 60% interest in Bryan Ltd on 30 June 2000 for $3008 000. Bryan Ltd's shareholders' equity at 30 June 2000 was: $000 Share capital 2 000 Retained earnings 2 000 4 000 ==== At the acquisition date, Bryan Ltd had no recorded goodwill. All the identifiable assets and liabilities of Bryan Ltd were recorded at fair value except the following: Carrying amount $000 Inventory 500 Non-current assets (net) 1 200 Fair value $000 600 1 500 The non-current assets had a further expected life of 10 years, with benefits from use being received evenly over these years. By 30 June 2007, the entire inventory had been sold by Bryan Ltd. (i) Included in current assets of Hunter Ltd at 30 June 2008 is inventory that was purchased from Bryan Ltd for $900 000. (ii) Included in current assets of Hunter Ltd at 30 June 2007 was inventory that was purchased from Bryan Ltd for $600 000. Bryan Ltd sells its goods at cost plus 50% mark-up. Page | 3 (iii) Included in the non-current assets of Bryan Ltd at 30 June 2008 is an item of plant that was sold to Bryan Ltd by Hunter Ltd on 1 July 2007 for $1200000. At the date of sale, this asset had a carrying amount of Hunter Ltd of $1000000. It had an expected future useful life of 5 years, with benefits being received evenly over these years. The tax rate is 20%. Required: A. Show the pre-acquisition analysis as at 30 June 2000. (5 marks) B. Prepare the relevant journal entries to effect the consolidation for Parent & NCI for year ending 30/6/2008. (10 marks) C. Prepare the consolidation worksheet. (10 marks) D. Prepare the Statement of Comprehensive Income and the Statement of Changes in Equity for the group for the year ended 30th June 2008. (5 marks) E. Prepare the Statement of Financial Position as at 30th June 2008. (10 marks)