Assessment 3- Case Study Questions.docx
The financial information for Moon Ltd and its 100% owned subsidiary, Light Ltd, for the period ended 31 December 2022 is as follows:
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AutoSave . Off) Assessment 3- Case Study Questions.docx - Protected View - Saved to this PC Sathana3848@gmail.com s X File Home Insert Draw Design Layout References Mailings Review View Help Search Share Comments iPROTECTED VIEW Be careful-files from the Internet can contain viruses. Unless you need to edit, it's safer to stay in Protected View. Enable Editing Moon Ltd acquired its shares in Light Ltd at 1 January 2022 for $45 000 on a cum div. basis. At that date, Light Ltd recorded share capital of $30 000. Light Ltd had declared prior to the acquisition a dividend of $5000 that was paid in April 2022. At 1 January 2022, all identifiable assets and liabilities of Light Ltd were recorded at fair value except for inventories, for which the carrying amount was $700 less than fair value. There was a fall in sales due to some negative google reviews and hence, 10% of inventories was still on hand at 31 December 2022. Inventories on hand in Light Ltd at 31 December 2022 also includes some items acquired from Moon Ltd during the period ended 31 December 2022. These were sold by Moon Ltd for $12 000, at a profit before tax of $4000. N Half of the goodwill on acquisition of Light Ltd by Moon Ltd was written off as the result of an impairment test on 31 December 2022. During March 2022, Moon Ltd provided some management services to Light Ltd at a fee of $3000 paid by 31 December 2022. On 1 July 2022, Light Ltd sold equipment to Moon Ltd for a gain of $5000. This equinment had a carrving amount to Light Ltd of $50 000. and was considered by Moon Page 1 of 2 539 words Focus + 100% Type here to search O ? ENG 7:38 PM 15/09/2020AutoSave . Off) Assessment 3- Case Study Questions.docx - Protected View - Saved to this PC Sathana3848@gmail.com s X File Home Insert Draw Design Layout References Mailings Review View Help Search Share Comments iPROTECTED VIEW Be careful-files from the Internet can contain viruses. Unless you need to edit, it's safer to stay in Protected View. Enable Editing On 1 July 2022, Light Ltd sold equipment to Moon Ltd for a gain of $5000. This equipment had a carrying amount to Light Ltd of $50 000, and was considered by Moon Ltd to have a 5-year life. By 31 December 2022, the financial assets acquired by Moon Ltd and Light Ltd from external entities increased in value by $3000 and $1500 respectively with gains and losses being recognised in other comprehensive income. The income tax rate is 30%. With your group partners you are required to: 1. Prepare the acquisition analysis at 1 January 2022. 2. Prepare the business combination valuation entries and pre-acquisition entries at 1 January 2022 . Prepare the business combination valuation entries and pre-acquisition entries at 31 December 2022. 4. Prepare the consolidation worksheet journal entries to eliminate the effects of intragroup transactions at 31 December 2022. Discuss the concept of 'realisation' using the intragroup transactions in this question to illustrate the concept. 6. Prepare the consolidation worksheet for the preparation of the consolidated financial statements for the period ended 31 December 2022. 7. Prepare the consolidated statement of profit or loss and other comprehensive income for Moon Ltd and its subsidiary, Light Ltd, at 31 December 2022. Screenshot saved The screenshot was added to your OneDrive. OneDrive Page 2 of 2 539 words U,TOCUS Type here to search w (? [)) ENG 7:38 PM 15/09/2020AutoSave . Off) Assessment 3- Case Study Questions.docx - Protected View - Saved to this PC Sathana3848@gmail.com s X File Home Insert Draw Design Layout References Mailings Review View Help Search Share Comments i PROTECTED VIEW Be careful-files from the Internet can contain viruses. Unless you need to edit, it's safer to stay in Protected View. Enable Editing ASSESSMENT 3 - CASE STUDY CONSOLIDATIONS AND INTER-COMPANY TRANSACTIONS. The financial information for Moon Ltd and its 100% owned subsidiary, Light Ltd, for the period ended 31 December 2022 is as follows: Moon Ltd Light Ltd Sales revenue 60 000 $ 57 000 Dividend revenue 3 000 Gain on sale of property, plant and equipment 3 000 6000 Other income 4 000 6 00 Total income 70 000 68 000 Cost of sales 45 000 38 000 Other expenses 7 000 4 00 Total expenses 52 000 42 000 Profit before income tax 18 000 26 000 Income tax expense 5 800 5 100 Profit for the period 12 20 19 90 Retained earnings (1/1/22) 14 00 9 00 26 200 28 900 Interim dividend paid 7 000 3 00 Retained earnings (31/12/22) 19 200 25 90 -TILLTAJ -4 1 - anan c... OF non Page 1 of 2 539 words Focus + 100% Type here to search O 9 (? ENG 7:38 PM 15/09/2020 E
