A. Prepare the journal entries in the records of Bolan Ltd to account for the investment in Rex Ltd in accordance with AASB 128 for the year ended 30 June 2020 assuming Bolan Led does not prepare consolidated financial statements. B. Prepare the consolidation worksheet Journal entries for the preparation of consolidated financial statements by Ormolu Ltd at 30 June 2019.

On 1 July 2017, Bolan Lid purchased 40% of the shares of Rex Lid for $151 680 and signed a joint venture agreement with the two other shareholders in Rex Lid. At that date, equity of Rex Lid consisted of: Share capital $300 000 Retained earnings 26 400 At 1 July 2017, the identifiable assets and liabilities of Rex Lid were recorded at amounts equal to their fair values. Information about income and changes in equity for both companies for the year ended 30 June 2020 was as shown. Bolan Lid Rex Lid Profit before tax $ 62 400 $ 56 400 Income tax expense (25 440) (12 960) Profit 36 960 43 440 Retained earnings (1/7/19) 43 200 38 400 80 160 81 840 Dividend paid (12 000) (9 600 Dividend declared (24 000) (12 000) (36 000) (21 600) Retained earnings (30/6/20) $ 44 160 $ 60 240 Additional information (a) Bolan Lid recognised the final dividend revenue from Rex Lid before receipt of cash. Rex Lid declared a $14 400 dividend in June 2019, this being paid in August 2019. (b) On 31 December 2019, Rex Lid sold Bolan Lid a motor vehicle for $28 800. The vehicle had originally cost Rex Lid $43 200 and was written down to $21 600 for both tax and accounting purposes at time of sale to Bolan Lid. Both companies depreciated motor vehicles at the rate of 20% p.a. on cost. (c) The beginning inventory of Rex Lid included goods at $9 600 bought from Bolan Lid; their cost to Bolan Lid was $7 680. (d) The ending inventory of Bolan Lid included goods purchased from Rex Lid at a profit before tax of $3 840. (e) The tax rate is 30%