Assessment 3 Assessment Type: Short report on Consolidated financial statements and calculations- Individual assessment. Purpose: This assessment is designed to allow students to research and analyse accounting standards and interpret how they apply to various corporate groups. It enables students to identify and solve problems relating to accounting for consolidated groups. This relates to learning outcomes a, b and c. Value: 30% Due Date: Week 10- Friday 8:00 pm. Topic: Consolidated worksheet, consolidated financial statements. Task Details: Consolidated financial statements from worksheet with adjustment entries for inventories, PPE, and dividends On 1 July 2019, Dexin Ltd acquired all the issued shares of Rumer Ltd. At this date, the shareholders equity of Rumer Ltd was: Share capital 100000 shares $ 450000 General reserve 45000 Asset revaluation surplus 45000 Retained earnings 15000 All the identifiable assets and liabilities at acquisition date were recorded at amounts equal to their fair values except for: Carrying amount Fair value Plant (cost $290000) $ 220000 $ 227500 Inventories 160000 175000 The plant was considered to have a further 5-year life. It was sold on 1 January 2022 for $118000. The inventories were all sold by 30 June 2020. At the acquisition date, Rumer Ltd also had a contingent liability relating to a lawsuit by a customer for faulty goods with a fair value of $18000. The lawsuit was settled in May 2020 when Rumer Ltd was required to pay damages of $20000. Additional information (a) On 1 July 2020, Dexin Ltd sold the plant to Rumer Ltd at a before-tax profit of $6000. Dexin Ltd depreciated this asset at 20% p.a. on cost, while Rumer Ltd uses a rate of 10% p.a. on cost. (b) In June 2021, Rumer Ltd sold $50000 worth of inventories to Dexin Ltd at a before-tax profit of $5400. At 30 June 2022, Dexin Ltd still had some of these inventories on hand. The profit that had been made by Rumer Ltd on the remaining inventories was $750. (c) In June 2022, Rumer Ltd declared a dividend of $6000 that will be paid in August 2022. (d) Both Dexin Ltd and Rumer Ltd use the revaluation model to measure land. In June 2022, Dexin Ltd recorded revaluation increases of $15000, while Rumer Ltd recorded increases of $12000. (e) The tax rate is 30% Financial information provided by the companies for 30 June 2022 was as follows: Dexin Ltd Rumer Ltd Plant $ 558750 $ 318000 Accumulated depreciation plant (318000) (165000) Land 531300 397500 Shares in Rumer Ltd 594000 Inventories 270000 240000 Receivables 43500 22500 Cash 37500 15000 Total assets $ 1717050 $ 828000 Dividend payable 15000 6000 Other current liabilities 52050 60000 Loans 150000 60000 Total liabilities $ 217050 $ 126000 Share capital $ 1200000 $ 450000 General reserve 45 000 Asset revaluation surplus 225000 120000 Retained earnings (1/7/21) 22500 18000 Revenues 162000 210000 Expenses (48000) (80000) Gains on sale of non-current assets 6000 5000 Income tax expense (52500) (60000) Dividend declared (15000) (6000) Total equity $ 1500000 $ 702000 Required 1. Calculate acquisition analysis as at 1 July 2019 2. Prepare the consolidation journal entries for 30 June 2022 3. Complete the consolidated worksheet for 30 June 2022 4. Prepare the consolidated financial statements at 30 June 2022 5. Write a report to explain the consolidation worksheet entries for the intragroup transactions as per AASB10.