1. a) Record the consolidated journal entries necessary to prepare consolidated accounts for the year ending 30 June 2021 for the group comprising Parent Ltd

   and Subsidiary Ltd (In Sheet 2:Consolidated Journal Entries).

2. b) Complete the consolidated worksheet for the year ending 30 June 2021 (In Sheet 3: Consolidated Worksheet).

   1. Entering the consolidated journal entries in Part (a) above to the appropriate debit and credit columns in the Consolidated Worksheet; and

   2. Completing the Group figures in the Consolidated Worksheet.

3. c) XXX Ltd is a 51 per cent shareholder in C Ltd and currently has two out of five board seats. YYY Ltd is the remaining 49 per cent shareholder in C Ltd and currently has the other three seats. XXX Ltd is a passive shareholder as it is happy with the way YYY Ltd has been running the company. Advise XXX Ltd (In Sheet 6: Discussion on Part c) whether it is required to prepare consolidated financial statements (word limit: 250 words max).

On 1/07/2018 100% $3,928,000 Big Ltd acquired: of the issued shares of Small Ltd for: At the date of acquisition, the Owners' Equity of Small Ltd consisted of: Share capital Plant replacement reserve Retained earnings $1,767,600 $441,900 $331,380 $2,540,880 As at 30/06/2021 The accounts of the two companies appear as follows: Sales less Cost of Goods Sold Depreciation expense Interest expense Other expenses Big Ltd $ 6,285,000 3,771,000 314,200 251,400 593,500 Small Ltd $ 3,167,400 2,058,800 158,300 64,790 131,410 Other Income plus Interest revenue Dividend revenue 0 97,100 343,700 0 less Income tax expense Net Profit after Tax 538,700 1,257,000 1,885,400 3,142,400 226,200 527,900 552,300 1,080,200 #VALUE! Available for appropriation Interim dividend paid Final dividend declared Retained earnings (30/06/2021) 294,600 491,000 2,356,800 147,300 196,400 736,500 Share Capital Plant replacement reserve Total Owner's Equity 5,106,400 392,800 7,856,000 1,767,600 441,900 2,946,000 #VALUE! 0 Dividend payable Deferred Tax Liability Other liabilities Total Liabilities 491,000 589,200 883,800 1,964,000 589,000 196,400 49,100 147,500 982,000 Total Liabilities & Owner's Equity 9,820,000 3,928,000 0 Assets Dividend receivable Inventory Property, Plant & Equipment Accumulated depreciation Land Investment in Small Ltd Loan receivable Other assets Total Assets 196,400 1,374,800 2,651,400 -1,060,600 1,669,400 3,928,000 589,000 471,600 9,820,000 235,600 1,571,200 -314,300 1,571,200 0 0 864,300 3,928,000 Additional information: a) At date of acquisition, all identifiable net assets of Small Ltd were recorded at fair value, with the exception of a block of land in the books of Small Ltd. The block of land had a carrying value of: and a fair value of: $1,571,200 $2,190,000 b) The directors apply the impairment test for goodwill annually. As at 30/06/2021 The cumulative goodwill impairment write-downs for prior years totalled: $763,000 On 1/07/2019 c) An equipment owned by Small Ltd was sold to Big Ltd. Cost of the equipment was: Accumulated depreciation of the equipment was: The asset was sold for: Big Ltd estimated this item had a remaining useful life of: and residual value of: $703,000 $251,000 $628,000 5 $0 years d) The opening inventory of Big Ltd includes unrealised profit of: $412,000 on inventory transferred from Small Ltd during the prior financial year. All of this inventory was sold by Big Ltd to parties external to the Group. 30/06/2021 e) During the current year, Big Ltd purchased inventory from Small Ltd for: This inventory had previously cost Small Ltd: $1,787,000 $714,000 Percentage of this inventory sold to outsiders by Big Ltd during the year was: 50% f) Small Ltd borrowed a loan from Big Ltd amounting to: Small Ltd paid the annual interest for the intra group loan at a rate of: $589,000 11% On 30/06/2021 g) During the current year, Big Ltd paid Arina Ltd, an external party for management fees expense amouning to: $2,000 h) The following are dividends paid and declared by Small Ltd to Big Ltd: Interim dividend paid Final dividend declared 147,300 196,400 i) The tax rate is: 30% AutoSave OFF nro ... Home Insert Draw Page Layout Formulas Le Share Comments Assignment 2_T2 2021 MAA363 Consolidation Assignment Proforma (1) Data Review View Developer Tell me == General Conditional Formatting v Insert , Format as Table DX Delete v $ % ) Cell Styles v Format v Calibri (Body) v 11 v Al A Ev 29 0 0 LL Paste BI U V Sensitivity YA A 1 Sort & Filter Find & Select Analyze Data V B C D E F . I Ref Dr ($) Cr($) Total Drs so Total Crs $0 Note 1: The number of rows is not an Indication of how long the answer is. Note 2: The column for "Ref" is used for posting to the consolidated worksheet. You can use 1, 2, E21 fx A 1 1. Consolidation Adjustments at 30/6/2021 2 3 Accounts 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 Background Information Ready IT Consolidated Journal Entries Consolidated Worksheet Consolidated Income Statement Consolidated Balance Sheet Discussion on partc + 1B 100% Big Ltd Small Ltd Group Consolidated Entries Dr Cr Ref Ref Sales less Cost of Goods Sold $6,285,000 $3,167,400 $3,771,000 $2,058,800 Depreciation expenses Interest expenses Other expenses $314,200 $251,400 $593,500 $ 158,300 $64,790 $131,410 Other Income plus Interest revenue Dividend revenue $97,100 $343,700 $0 $0 less Income tax expense $538,700 $226,200 Net Profit $1,257,000 $1,885,400 $527,900 $552,300 #VALUE! Available for appropriation $3,142,400 $1,080,200 Interim dividend paid Final dividend declared Retained earnings (30/06/2021) $294,600 $491,000 $2,356,800 $147,300 $196,400 $736,500 Share Capital Plant Replacement Reserve BCVR / Revaluation Reserve Total Owner's Equity $5,106,400 $1,767,600 $392,800 $441,900 $0 $0 $7,856,000 $2,946,000 #VALUE! Dividend payable Deferred Tax Liability Other liabilities Total Liabilities $0 $491,000 $589,200 $883,800 $1,964,000 $589,000 $196,400 $49,100 $147,500 $982,000 Total Liabilities & Owner's Equity $9,820,000 $3,928,000 Assets Dividend receivables Inventory Property, Plant & Equipment Accumulated depreciation Land Investment in Small Ltd Loan receivable Goodwill Accumulated Impairment Loss Deferred Tax Asset $196,400 $0 $1,374,800 $235,600 $2,651,400 $1,571,200 $1,060,600 $314,300 $1,669,400 $1,571,200 $3,928,000 $0 $589,000 $0 $0 $0 $0 $0 $0 $0 Other assets Total Assets $471,600 $864,300 $9,820,000 $3,928,000 $0 $0 $0 $0 Consolidated statement of comprehensive income for the year ended 30 June 2021 Economic Entity Sales revenue $0 Cost of goods sold $0 Gross profit $0 less Depreciation expenses $0 Interest expenses $0 Other expenses $0 Total expenses $0 Plus Other income Interest revenue $0 Dividend revenue $0 Total other income $0 Net profit before tax $0 Income tax expense $0 Net profit after tax (NPAT) $0 NPAT Attributable to Parent (100%) $0 NPAT Attributable to NCI (0%) $0 100% 0% Big Ltd and its subsidiary Consolidated statement of financial position as at 30 June 2021 Economic Entity Assets Current Assets Dividend receivables $0 Inventory $0 Non current Assets Property Plant & Equipment Accumulated depreciation Land Investment in Small Ltd Loan receivable Goodwill Accumulated impairment losses Deferred tax asset Other assets Total assets $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 Liabilities Current Liabilities Dividend payable $0 Non-current liabilities #VALUE! Deferred tax liability Other liabilities Total Liabilities $0 $0 $0 $0 Retained earnings (30/06/2021) Share Capital Plant Replacement Reserve BCVR/Revaluation reserve Total Shareholder's Equity $0 $0 $0 $0 $0 $0 On 1/07/2018 100% $3,928,000 Big Ltd acquired: of the issued shares of Small Ltd for: At the date of acquisition, the Owners' Equity of Small Ltd consisted of: Share capital Plant replacement reserve Retained earnings $1,767,600 $441,900 $331,380 $2,540,880 As at 30/06/2021 The accounts of the two companies appear as follows: Sales less Cost of Goods Sold Depreciation expense Interest expense Other expenses Big Ltd $ 6,285,000 3,771,000 314,200 251,400 593,500 Small Ltd $ 3,167,400 2,058,800 158,300 64,790 131,410 Other Income plus Interest revenue Dividend revenue 0 97,100 343,700 0 less Income tax expense Net Profit after Tax 538,700 1,257,000 1,885,400 3,142,400 226,200 527,900 552,300 1,080,200 #VALUE! Available for appropriation Interim dividend paid Final dividend declared Retained earnings (30/06/2021) 294,600 491,000 2,356,800 147,300 196,400 736,500 Share Capital Plant replacement reserve Total Owner's Equity 5,106,400 392,800 7,856,000 1,767,600 441,900 2,946,000 #VALUE! 0 Dividend payable Deferred Tax Liability Other liabilities Total Liabilities 491,000 589,200 883,800 1,964,000 589,000 196,400 49,100 147,500 982,000 Total Liabilities & Owner's Equity 9,820,000 3,928,000 0 Assets Dividend receivable Inventory Property, Plant & Equipment Accumulated depreciation Land Investment in Small Ltd Loan receivable Other assets Total Assets 196,400 1,374,800 2,651,400 -1,060,600 1,669,400 3,928,000 589,000 471,600 9,820,000 235,600 1,571,200 -314,300 1,571,200 0 0 864,300 3,928,000 Additional information: a) At date of acquisition, all identifiable net assets of Small Ltd were recorded at fair value, with the exception of a block of land in the books of Small Ltd. The block of land had a carrying value of: and a fair value of: $1,571,200 $2,190,000 b) The directors apply the impairment test for goodwill annually. As at 30/06/2021 The cumulative goodwill impairment write-downs for prior years totalled: $763,000 On 1/07/2019 c) An equipment owned by Small Ltd was sold to Big Ltd. Cost of the equipment was: Accumulated depreciation of the equipment was: The asset was sold for: Big Ltd estimated this item had a remaining useful life of: and residual value of: $703,000 $251,000 $628,000 5 $0 years d) The opening inventory of Big Ltd includes unrealised profit of: $412,000 on inventory transferred from Small Ltd during the prior financial year. All of this inventory was sold by Big Ltd to parties external to the Group. 30/06/2021 e) During the current year, Big Ltd purchased inventory from Small Ltd for: This inventory had previously cost Small Ltd: $1,787,000 $714,000 Percentage of this inventory sold to outsiders by Big Ltd during the year was: 50% f) Small Ltd borrowed a loan from Big Ltd amounting to: Small Ltd paid the annual interest for the intra group loan at a rate of: $589,000 11% On 30/06/2021 g) During the current year, Big Ltd paid Arina Ltd, an external party for management fees expense amouning to: $2,000 h) The following are dividends paid and declared by Small Ltd to Big Ltd: Interim dividend paid Final dividend declared 147,300 196,400 i) The tax rate is: 30% AutoSave OFF nro ... Home Insert Draw Page Layout Formulas Le Share Comments Assignment 2_T2 2021 MAA363 Consolidation Assignment Proforma (1) Data Review View Developer Tell me == General Conditional Formatting v Insert , Format as Table DX Delete v $ % ) Cell Styles v Format v Calibri (Body) v 11 v Al A Ev 29 0 0 LL Paste BI U V Sensitivity YA A 1 Sort & Filter Find & Select Analyze Data V B C D E F . I Ref Dr ($) Cr($) Total Drs so Total Crs $0 Note 1: The number of rows is not an Indication of how long the answer is. Note 2: The column for "Ref" is used for posting to the consolidated worksheet. You can use 1, 2, E21 fx A 1 1. Consolidation Adjustments at 30/6/2021 2 3 Accounts 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 Background Information Ready IT Consolidated Journal Entries Consolidated Worksheet Consolidated Income Statement Consolidated Balance Sheet Discussion on partc + 1B 100% Big Ltd Small Ltd Group Consolidated Entries Dr Cr Ref Ref Sales less Cost of Goods Sold $6,285,000 $3,167,400 $3,771,000 $2,058,800 Depreciation expenses Interest expenses Other expenses $314,200 $251,400 $593,500 $ 158,300 $64,790 $131,410 Other Income plus Interest revenue Dividend revenue $97,100 $343,700 $0 $0 less Income tax expense $538,700 $226,200 Net Profit $1,257,000 $1,885,400 $527,900 $552,300 #VALUE! Available for appropriation $3,142,400 $1,080,200 Interim dividend paid Final dividend declared Retained earnings (30/06/2021) $294,600 $491,000 $2,356,800 $147,300 $196,400 $736,500 Share Capital Plant Replacement Reserve BCVR / Revaluation Reserve Total Owner's Equity $5,106,400 $1,767,600 $392,800 $441,900 $0 $0 $7,856,000 $2,946,000 #VALUE! Dividend payable Deferred Tax Liability Other liabilities Total Liabilities $0 $491,000 $589,200 $883,800 $1,964,000 $589,000 $196,400 $49,100 $147,500 $982,000 Total Liabilities & Owner's Equity $9,820,000 $3,928,000 Assets Dividend receivables Inventory Property, Plant & Equipment Accumulated depreciation Land Investment in Small Ltd Loan receivable Goodwill Accumulated Impairment Loss Deferred Tax Asset $196,400 $0 $1,374,800 $235,600 $2,651,400 $1,571,200 $1,060,600 $314,300 $1,669,400 $1,571,200 $3,928,000 $0 $589,000 $0 $0 $0 $0 $0 $0 $0 Other assets Total Assets $471,600 $864,300 $9,820,000 $3,928,000 $0 $0 $0 $0 Consolidated statement of comprehensive income for the year ended 30 June 2021 Economic Entity Sales revenue $0 Cost of goods sold $0 Gross profit $0 less Depreciation expenses $0 Interest expenses $0 Other expenses $0 Total expenses $0 Plus Other income Interest revenue $0 Dividend revenue $0 Total other income $0 Net profit before tax $0 Income tax expense $0 Net profit after tax (NPAT) $0 NPAT Attributable to Parent (100%) $0 NPAT Attributable to NCI (0%) $0 100% 0% Big Ltd and its subsidiary Consolidated statement of financial position as at 30 June 2021 Economic Entity Assets Current Assets Dividend receivables $0 Inventory $0 Non current Assets Property Plant & Equipment Accumulated depreciation Land Investment in Small Ltd Loan receivable Goodwill Accumulated impairment losses Deferred tax asset Other assets Total assets $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 Liabilities Current Liabilities Dividend payable $0 Non-current liabilities #VALUE! Deferred tax liability Other liabilities Total Liabilities $0 $0 $0 $0 Retained earnings (30/06/2021) Share Capital Plant Replacement Reserve BCVR/Revaluation reserve Total Shareholder's Equity $0 $0 $0 $0 $0 $0