(b) Complete the consolidated worksheet for the year ending 30 June 2022 (In Sheet 3: Consolidated Worksheet). i. Entering the consolidated journal entries in Part (a) above to the appropriate debit and credit columns in the Consolidated Worksheet; and ii. Completing the Group figures in the Consolidated Worksheet.

(a) Record the consolidated journal entries necessary to prepare consolidated accounts for the year ending 30 June 2022 for the group comprising M Ltd and N Ltd

(Please make a consolidated journal entry with relevant accounts listed eg Land Dr Cr with a reference eg Land (reference 1) etc.)

M Ltd N Ltd Group Consolidated Entries Dr Cr Ref Ref Sales less Cost of Goods Sold $4,147,500 $2,089,800 $2,488,500 $1,358,300 Depreciation expenses Interest expenses Other expenses $207,300 $104,400 $165,900 $62,080 $420,700 $67,520 Other Income plus Interest revenue Dividend revenue $93,100 $226,800 $0 $0 Jess Income tax expense $355,500 $149,200 Net Profit Retained earnings (01/07/2021) $829,500 $348,300 $1,244,100 $364,500 Available for appropriation $2,073,600 $712,800 Interim dividend paid Final dividend declared Retained earnings (30/06/2022) $194,400 $97,200 $324,000 $129,600 $1,555,200 $486,000 Share Capital Plant Replacement Reserve BCVR / Revaluation Reserve Total Owner's Equity $3,369,600 $1,166,400 $259,200 $291,600 $0 $0 $5,184,000 $1,944,000 Loan payable (due 30/06/2024) Dividend payable Deferred Tax Liability Other liabilities Total Liabilities $0 $388,000 $324,000 $129,600 $388,800 $32,400 $583,200 $98,000 $1,296,000 $648,000 Total Liabilities & Owner's Equity $6,480,000 $2,592,000 Assets Dividend receivables Inventory Property, Plant & Equipment Accumulated depreciation Land Investment in Small Ltd Loan receivable Goodwill Accumulated Impairment Loss Deferred Tax Asset $129,600 $0 $907,200 $155,500 $1,749,600 $1,036,800 -$699,900 - $207,400 $1,101,600 $1,036,800 $2,592,000 $0 $388,000 $0 $0 $0 $0 $0 $0 $0 Other assets Total Assets $311,900 $570,300 $6,480,000 $2,592,000 $0 $0 $0 $0 On 1/07/2019 MLtd acquired: 100% of the issued shares of NLtd for: $2,592,000 At the date of acquisition, the Owners' Equity of NLtd consisted of: Share capital $1,166,400 Plant replacement reserve $291,600 Retained earnings $218,700 $1,676,700 As at 30/06/2022 The accounts of the two companies appear as follows: Sales e Cost of Goods Sold Depreciation expense Interest expense Other expenses MLtd $ 4,147,500 2,488,500 207,300 165,900 420,700 NLtd $ 2,089,800 1,358,300 104,400 62,080 67,520 Other Income pils Interest revenue Dividend revenue 93,100 226,800 OO es Income tax expense Net Profit after Tax Retained earnings (01/07/2021) Available for appropriation 355,500 829,500 1,244,100 2,073,600 149,200 348,300 364,500 712,800 Interim dividend paid Final dividend declared Retained earnings (30/06/2022) 194,400 324,000 1,555,200 97,200 129,600 486,000 Share Capital Plant replacement reserve Total Owner's Equity 3,369,600 259,200 5,184,000 1,166,400 291,600 1,944,000 Loan payable (due 30/06/2024) Dividend payable Deferred Tax Liability Other liabilities Total Liabilities 0 324,000 388,800 583,200 1,296,000 388,000 129,600 32,400 98,000 648,000 Total Liabilities & Owner's Equity 6,480,000 2,592,000 Assets Dividend receivable Inventory Property, Plant & Equipment Accumulated depreciation Land Investment in NLtd Loan receivable Other assets Total Assets 129,600 0 907,200 155,500 1,749,600 1,036,800 -699,900 -207,400 1,101,600 1,036,800 2,592,000 0 388,000 0 311,900 570,300 6,480,000 2,592,000 Additional information: a) At date of acquisition, all identifiable net assets of NLtd were recorded at fair value, with the exception of a block of land in the books of NLtd. The block of land had a carrying value of: and a fair value of: $1,036,800 $1,450,000 b) The directors apply the impairment test for goodwill annually. at 30/06/2022 The cumulative goodwill impairment write-downs for prior years totalled: $500,000 1/07/2020 C) An equipment owned by NLtd was sold to MLtd. Cost of the equipment was: Accumulated depreciation of the equipment was: The asset was sold for: MLtd estimated this item had a remaining useful life of: and residual value of: $463,000 $165,000 $414,000 5 $0 years $272,000 d) The opening inventory of MLtd includes unrealised profit of: on inventory transferred from NLtd during the prior financial year. All of this inventory was sold by MLtd to parties external to the 30/06/2022 Group. e) During the current year, MLtd purchased inventory from N Ltd for: This inventory had previously cost NLtd: Percentage of this inventory sold to outsiders by MLtd during the year was: $1,179,000 $471,000 50% f) NLtd borrowed a loan from MLtd amounting to: 30/06/2022 NLtd paid the annual interest for the intra group loan at arate ol $388,000 16% g) During the current year, MLtd paid QLtd, an external party for management fees expense amouning to: $2,000 h) The following are dividends paid and declared by NLtd to M Ltd: Interim dividend paid Final dividend declared 97,200 129,600 i) The tax rate is: 30% M Ltd N Ltd Group Consolidated Entries Dr Cr Ref Ref Sales less Cost of Goods Sold $4,147,500 $2,089,800 $2,488,500 $1,358,300 Depreciation expenses Interest expenses Other expenses $207,300 $104,400 $165,900 $62,080 $420,700 $67,520 Other Income plus Interest revenue Dividend revenue $93,100 $226,800 $0 $0 Jess Income tax expense $355,500 $149,200 Net Profit Retained earnings (01/07/2021) $829,500 $348,300 $1,244,100 $364,500 Available for appropriation $2,073,600 $712,800 Interim dividend paid Final dividend declared Retained earnings (30/06/2022) $194,400 $97,200 $324,000 $129,600 $1,555,200 $486,000 Share Capital Plant Replacement Reserve BCVR / Revaluation Reserve Total Owner's Equity $3,369,600 $1,166,400 $259,200 $291,600 $0 $0 $5,184,000 $1,944,000 Loan payable (due 30/06/2024) Dividend payable Deferred Tax Liability Other liabilities Total Liabilities $0 $388,000 $324,000 $129,600 $388,800 $32,400 $583,200 $98,000 $1,296,000 $648,000 Total Liabilities & Owner's Equity $6,480,000 $2,592,000 Assets Dividend receivables Inventory Property, Plant & Equipment Accumulated depreciation Land Investment in Small Ltd Loan receivable Goodwill Accumulated Impairment Loss Deferred Tax Asset $129,600 $0 $907,200 $155,500 $1,749,600 $1,036,800 -$699,900 - $207,400 $1,101,600 $1,036,800 $2,592,000 $0 $388,000 $0 $0 $0 $0 $0 $0 $0 Other assets Total Assets $311,900 $570,300 $6,480,000 $2,592,000 $0 $0 $0 $0 On 1/07/2019 MLtd acquired: 100% of the issued shares of NLtd for: $2,592,000 At the date of acquisition, the Owners' Equity of NLtd consisted of: Share capital $1,166,400 Plant replacement reserve $291,600 Retained earnings $218,700 $1,676,700 As at 30/06/2022 The accounts of the two companies appear as follows: Sales e Cost of Goods Sold Depreciation expense Interest expense Other expenses MLtd $ 4,147,500 2,488,500 207,300 165,900 420,700 NLtd $ 2,089,800 1,358,300 104,400 62,080 67,520 Other Income pils Interest revenue Dividend revenue 93,100 226,800 OO es Income tax expense Net Profit after Tax Retained earnings (01/07/2021) Available for appropriation 355,500 829,500 1,244,100 2,073,600 149,200 348,300 364,500 712,800 Interim dividend paid Final dividend declared Retained earnings (30/06/2022) 194,400 324,000 1,555,200 97,200 129,600 486,000 Share Capital Plant replacement reserve Total Owner's Equity 3,369,600 259,200 5,184,000 1,166,400 291,600 1,944,000 Loan payable (due 30/06/2024) Dividend payable Deferred Tax Liability Other liabilities Total Liabilities 0 324,000 388,800 583,200 1,296,000 388,000 129,600 32,400 98,000 648,000 Total Liabilities & Owner's Equity 6,480,000 2,592,000 Assets Dividend receivable Inventory Property, Plant & Equipment Accumulated depreciation Land Investment in NLtd Loan receivable Other assets Total Assets 129,600 0 907,200 155,500 1,749,600 1,036,800 -699,900 -207,400 1,101,600 1,036,800 2,592,000 0 388,000 0 311,900 570,300 6,480,000 2,592,000 Additional information: a) At date of acquisition, all identifiable net assets of NLtd were recorded at fair value, with the exception of a block of land in the books of NLtd. The block of land had a carrying value of: and a fair value of: $1,036,800 $1,450,000 b) The directors apply the impairment test for goodwill annually. at 30/06/2022 The cumulative goodwill impairment write-downs for prior years totalled: $500,000 1/07/2020 C) An equipment owned by NLtd was sold to MLtd. Cost of the equipment was: Accumulated depreciation of the equipment was: The asset was sold for: MLtd estimated this item had a remaining useful life of: and residual value of: $463,000 $165,000 $414,000 5 $0 years $272,000 d) The opening inventory of MLtd includes unrealised profit of: on inventory transferred from NLtd during the prior financial year. All of this inventory was sold by MLtd to parties external to the 30/06/2022 Group. e) During the current year, MLtd purchased inventory from N Ltd for: This inventory had previously cost NLtd: Percentage of this inventory sold to outsiders by MLtd during the year was: $1,179,000 $471,000 50% f) NLtd borrowed a loan from MLtd amounting to: 30/06/2022 NLtd paid the annual interest for the intra group loan at arate ol $388,000 16% g) During the current year, MLtd paid QLtd, an external party for management fees expense amouning to: $2,000 h) The following are dividends paid and declared by NLtd to M Ltd: Interim dividend paid Final dividend declared 97,200 129,600 i) The tax rate is: 30%