Combinations

Hard Ltd is to take over the net assets of Hat Ltd. The statement of financial position of Hat Ltd immediately before the takeover is as follows.

Cash Accounts receivable Land Buildings {net} Farm equipment (net) Irrigation equipment {net} Vehicles {net} Accounts payable Loan ABC Bank Share capital Retained earnings Carrying amount 10 DOB 70 000 31 U 000 265 000 180 000 110 100 80 100 1 025 000 40 000 240 000 335 000 410 000 1 025 000 Fair value 10 DUO 62 500 420 000 275 000 182 000 112 500 86 DUO 4C} 000 24C} 000