acchelp

of 5 Marks CE Uomo A B I UX X E Particulars Debit Credit I On 1 July 2019, Parent Ltd. acquired 80% of the share capital of Son Ltd. for $1,600,000. On that date, the shareholders' equity of Son Ltd. consisted of share capital ($1,000,000) and retained earnings ($400,000). At acquisition date, all the assets and liabilities of Son Ltd. were recorded at amounts equal to fair value except for land and plant. Land had a carrying amount of $850,000 and a fair value of $900,000. Plant had a fair value of $200,000 and a carrying amount of $100,000 (original cost $250,000). The remaining useful life of the plant at the date of acquisition was 5 years. On 1 January 2020, Son Ltd. sold an item of equipment to Parent Ltd. for $200,000. At the time of sale, the original cost of this equipment in the books of Son Ltd. was 5300,000 and the carrying amount was $150,000. Both entities apply a 10% straight ne depreciation method for the equipment. On 30 June 2021, Parent Ltd sold the Equipment to an external party for $400,000. uring the financial year ended 30 June 2021, Son Ltd. provided Parent Ltd. with management services, the total charge for these services was $100,000 of which 20,000 was outstanding at 30 June 2021. iring the financial vear ender 30. June 2021 Son Itd sold moods to Parent itd that Report question issue P Notes - Question 3 Notes of 5 Marks CE Uomo A B I UX X E Particulars Debit Credit I On 1 July 2019, Parent Ltd. acquired 80% of the share capital of Son Ltd. for $1,600,000. On that date, the shareholders' equity of Son Ltd. consisted of share capital ($1,000,000) and retained earnings ($400,000). At acquisition date, all the assets and liabilities of Son Ltd. were recorded at amounts equal to fair value except for land and plant. Land had a carrying amount of $850,000 and a fair value of $900,000. Plant had a fair value of $200,000 and a carrying amount of $100,000 (original cost $250,000). The remaining useful life of the plant at the date of acquisition was 5 years. On 1 January 2020, Son Ltd. sold an item of equipment to Parent Ltd. for $200,000. At the time of sale, the original cost of this equipment in the books of Son Ltd. was 5300,000 and the carrying amount was $150,000. Both entities apply a 10% straight ne depreciation method for the equipment. On 30 June 2021, Parent Ltd sold the Equipment to an external party for $400,000. uring the financial year ended 30 June 2021, Son Ltd. provided Parent Ltd. with management services, the total charge for these services was $100,000 of which 20,000 was outstanding at 30 June 2021. iring the financial vear ender 30. June 2021 Son Itd sold moods to Parent itd that Report question issue P Notes - Question 3 Notes