Answer all parts (a) Hing has held shares in two companies, Sing and Ding, for a few years. As at 31 December 2020 they have the following statements of financial position: Hing RM Sing RM Ding RM Non-current assets Property, plant and equipment Investments 380,000 520.000 740,000 436.000 1.176.000 380.000 520.000 Curent assets Inventories Trade receivables Cash 320,000 340,000 100,000 760,000 1,936.000 200,000 180,000 80,000 460.000 840,000 360,000 200,000 20,000 580.000 1,100,000 Equity Share capital (RM1 per share) Share premium Retained earnings 400.000 200,000 1,136,000 1,736,000 160,000 160.000 400,000 720,000 100.000 60.000 800.000 960,000 Curent liabilities Trade payables 200,000 1,936,000 120.000 840,000 140,000 1.100.000 You ascertain the following additional information: 1. The 'investments in the statement of financial position comprise solely Hing's investment in Sing (RM256,000) and in Ding (RM180,000). 2. The 96,000 shares in Sing were acquired when Sing's retained earnings stood at RM40,000. The 30,000 shares in Ding were acquired when that company had a retained earnings balance of RM300,000. 3. When Hing acquired its shares in Sing the fair value of Sing's net assets equaled their book values with the following exceptions: Property, plant and equipment RM100,000 higher Inventories RM40,000 lower (sold during 2020) 4. Depreciation arising on the fair value adjustment to non-current assets since this date is RM10,000 5. During the year, Hing sold inventories to Sing for RM32,000, which originally cost Hing RM20,000. Three-quarters of these inventories have subsequently been sold by Sing. 6. No impairment losses on goodwill had been necessary by 31 December 2020. 7. It is group policy to value non-controlling interests at full (or fair) value. The fair value of the non-controlling interests at acquisition was RM180,000. Required: Produce the consolidated statement of financial position as at 31 December 2020 for the Hing group (incorporating the associate). (20 marks) (b) Explain why consolidated financial statements are useful to the users of financial statements (as opposed to just the parent company's separate (entity) financial statements). (5 marks) [Total: 25 Marks]