The following are the condensed financial statements of Makwebo Lad and subsidiary Zungulila Lad, which is partly owned: Balance sheets as at 30 June, 2006. Makwebo Ltd Zungulila Ltd K K Assets Investment in S Ltd: 64, 000 ondinary shares at cost price Debtors Inventories 70, 000 130, 000 10, 000 k10, 000 106, 000 30, 000 136, 000 Equity and Liabilities Authorised and issued share capital: KI,000 per ordinary 100, 000 80, 000 share Retained profit Creditors 26, 000 84, 000 20, 000 36, 000 136, 000 k10, 000 Income statement for the year ended 30" June, 2006. Mukwebo Ltd K Zungulila Lad K 80, 000 (40, 000) 40, 000 (29.500) 10, 500 (5, 000) 5. so Revenue 100, 000 (50, 000) 50, 000 Cost of sales Gross profit Other operating expenses Profit before tax 133.000) 17, 000 (7,000) 10, 000 tion Net profit for the year Statement of Changes in equity for the year ended 30- June, 2006. Makwebo Ltd Zungulila Ltd K K Balance at 30" June, 2005 Net profit for the year 21,000 10, 000 (5,000) 6, 000 14, 500 3. 500 Ordinary dividends Balance at 30 June 2006 20, 000 Makwebo Ltd purchased all its inventories from Zungulila Lad at a profit mark-up of 25% on the cost of the goods. These goods are inventories in the records of Zungulila Ltd. Total sakes from Zungulila Lad during the current financial year amounted to K50, 000. On l" July, 2004 the date on which Makwebo Ltd acquired the interest in Zungulila, the retained profit of the latter amounted to K7, 500. Required a) Prepare the consolidated income statement of Makwebo Lid and its subsidiaries for the year ended 30" June, 2006, b) Prepare the consolidated Balance sheet of Makwebo Lid and its subsidiaries as at 30* June, 2006,