A0056-3-2-CRPT Individual Assimment Panedors QUESTION 4 Planet ple, a public limited company is expanding the group business. On January 2020, Planet ple acquired 75% interest in Space Ltd and 25% interest in Acro Ltd. Planet plc is represented on Acro Ltd's board of directors. Below are the statement of comprehensive income of Planet ple, Space Lid and Aero Ltd for the year ended 31 December 2020. Planet plc Space Ltd Aero Ltd (S'000) (5'000) (S'000) Revenue 45.000 24.000 10,000 Cost of sales 26.000 (1.000) 16.00 Gross Profit 19.000 13,000 3.200 Operating expenses 6.00) 3.500) 1.700) Operating profit 12.940 9.500 1.500 to 20 Management services Space Lid Dividend from Space Ltd 600 Finance Income 200 (1.50) (120) (10) Finance costs Profit before tax 13.790 9,380 1,490 Taxation 4.800 (2780) (450) Profit after tax 8990 6.600 1040 Additional information: i) Planet ple trades with Space Lid and during the year. Planet ple sold goods for $3,000,000 to Space Ltd. ii) Planet ple sells to Space Ltd at cost plus 25%. Half of these goods remain unsold in Space Lid A0056-3-2-CRPT Individual Assiement Pares of iii) Planet ple has recognized a dividend declared and paid by Space Ltd of S600.000 during the year iv) Included in the operating expenses of Space Ltd is an amount of S200,000 management fees charged by Planet plc for the services provided. 1) Planet ple charges Space Ltd 4% interest for the advances of $5,000,000 granted to Space Lad on 1 July 2020 vi) Investment in Aero Ltd is impaired by S50,000 REQUIRED (a) Prepare the consolidated statement of comprehensive income for the year ended 31 December 2020. (Show all workings) (15 marks) (b) After the above statement presented to the directors, the operation director is questioning as to how to derive at the Group Revenue and why the Revenue of Aero Ltd has not been included as part of the Group Revenue. As a group accountant, give your explanation with justification to the director by referring to the relevant accounting standards (10 marks) (Total: 25 marks) (Grand Total: 100 marks) END OF QUESTIONS A0056-3-2-CRPT Individual Assimment Panedors QUESTION 4 Planet ple, a public limited company is expanding the group business. On January 2020, Planet ple acquired 75% interest in Space Ltd and 25% interest in Acro Ltd. Planet plc is represented on Acro Ltd's board of directors. Below are the statement of comprehensive income of Planet ple, Space Lid and Aero Ltd for the year ended 31 December 2020. Planet plc Space Ltd Aero Ltd (S'000) (5'000) (S'000) Revenue 45.000 24.000 10,000 Cost of sales 26.000 (1.000) 16.00 Gross Profit 19.000 13,000 3.200 Operating expenses 6.00) 3.500) 1.700) Operating profit 12.940 9.500 1.500 to 20 Management services Space Lid Dividend from Space Ltd 600 Finance Income 200 (1.50) (120) (10) Finance costs Profit before tax 13.790 9,380 1,490 Taxation 4.800 (2780) (450) Profit after tax 8990 6.600 1040 Additional information: i) Planet ple trades with Space Lid and during the year. Planet ple sold goods for $3,000,000 to Space Ltd. ii) Planet ple sells to Space Ltd at cost plus 25%. Half of these goods remain unsold in Space Lid A0056-3-2-CRPT Individual Assiement Pares of iii) Planet ple has recognized a dividend declared and paid by Space Ltd of S600.000 during the year iv) Included in the operating expenses of Space Ltd is an amount of S200,000 management fees charged by Planet plc for the services provided. 1) Planet ple charges Space Ltd 4% interest for the advances of $5,000,000 granted to Space Lad on 1 July 2020 vi) Investment in Aero Ltd is impaired by S50,000 REQUIRED (a) Prepare the consolidated statement of comprehensive income for the year ended 31 December 2020. (Show all workings) (15 marks) (b) After the above statement presented to the directors, the operation director is questioning as to how to derive at the Group Revenue and why the Revenue of Aero Ltd has not been included as part of the Group Revenue. As a group accountant, give your explanation with justification to the director by referring to the relevant accounting standards (10 marks) (Total: 25 marks) (Grand Total: 100 marks) END OF QUESTIONS
