$9\mathrm{.}1$

Calculate Left Ltd$\text{'}$s share of profits in Right Ltd for the year ended $30$ June $2023.$

The following information is relevant to questions $9\mathrm{.}1$ and $9\mathrm{.}2.$

Left is a parent company that prepares consolidated financial statements. On $1$ July $2021$ Left

Ltd acquired $40\%$ of the equity in Right Ltd for $$220000.$ At this date the equity in Right Ltd

consisted of:

Right Ltd carried its assets fair values with the exception of one item of plant & equipment

whose fair value was $$20000$ greater than its carrying amount. The estimated useful life of this

item is $4$ years. Summary of movements in the retained earnings of Right Ltd:

At $30$ June $2022$ there were unrealised profits before tax of $$10000$ arising from inventory

transfers between the two entities.