CASE STUDY BASIL LIMITED and LINDA LIMITED CONSOLIDA'HON AND GOODWILL ANALYSIS 0n 1 July 2019, BASIL Ltd acquired all the issued shares (ex-div.) of LINDA ltd for $272 000. At this date the financial statements of Lucky Ltd showed the following balance in its accounts: Share Capital $150 000 Retained Earnings 80 000 Goodwill 10 000 At 1 July 2019, all identifiable assets and liabilities of Linda Ltd were recorded at amounts equal to the fair value. The financial statements of Basil Ltd and Linda Ltd at 30 June 2020 contained the following information: Basil Ltd Linda Ltd S Profit for the period 35 000 25 000 Retained earnings (1/7/2019) 90 000 80 000 Transfer form General Reserve 10 000 RETAINED EARNINGS (30/6/2020) 125 000 115 000 Share Capital 700 000 150 000 General Reserve 92 000 30 000 TOTAL EQUITY 917 000 295 000 Provisions 30 000 20 000 Payables 15 000 25 000 Long-term loans 50 000 110 000 TOTAL LIABILITIES 95 000 155 000 TOTAL EQUITY and LIABILITIES 1 012 000 450 000 Plant 600 000 820 000 Accumulated depreciation (295 000) (650 000) Fixtures 300 000 120 000 Accumulated depreciation (180 000) (80 000) Land 200 000 140 000 Brands 50 000 30 000 Shares in Linda Ltd 272 000 0 Goodwill 0 10 000 Inventories 45 000 40 000 Cash 5 000 7 000 Receivables 15 000 13 000 TOTAL ASSETS 1 012 000 450 000