Financial information at 30 June 2020 of Great Ltd and its subsidiary company, Wall Ltd, is shown below. At 1 July 2017, the date Great Ltd acquired its 80% shareholding in Wall Ltd, all the identifiable assets and liabilities of Wall Ltd were at fair value except for the following assets: Carrying amount Fair value Plant (cost $75,000) $49,000 $55,000 Land 29,000 37,000 The plant has an expected life of 10 years, with benefits being received evenly over that period. Differences between carrying amounts and fair values are adjusted on consolidation. The land on hand at 1 July 2017 was sold on 1 February 2018 for $40,000. Any valuation reserve in relation to the land is transferred on consolidation to retained earnings. Great Ltd uses the full goodwill method. The fair value of the non-controlling interest at 1 July 2017 was $31,500. Great Ltd Wall Ltd Sales revenue $ 316,000 $ 220,000 Other revenue: Debenture interest 5,000 Management and consulting fees 5,000 Dividend from Wall Ltd 12,000 Total revenues 338,000 220,000 Cost of sales 130,000 85,000 Manufacturing expenses 90,000 60,000 Depreciation on plant 15,000 15,000 Administrative 15,000 8,000 Financial 11,000 5,000 Other expenses 14,000 12,000 Total expenses 275,000 185,000 Profit before tax 63,000 35,000 Income tax expense (25,000 ) (17,000 ) Profit 38,000 18,000 Retained earnings (1/7/19) 50,000 45,000 88,000 63,000 Transfer to general reserve 3,000 Interim dividend paid 10,000 10,000 Final dividend declared 10,000 5,000 23,000 15,000 Retained earnings (30/6/20) 65,000 48,000 General reserve 50,000 10,000 Other components of equity 13,000 10,000 Share capital 300,000 100,000 Debentures 200,000 100,000 Current tax liability 25,000 17,000 Dividend payable 10,000 5,000 Deferred tax liability 7,000 Other liabilities 90,000 12,000 $ 753,000 $ 309,000 Financial assets $ 50,000 $ 60,000 Debentures in Wall Ltd 100,000 Shares in Wall Ltd 131,600 Plant (cost) 120,000 102,000 Accumulated depreciation - plant (65,000 ) (55,000 ) Other depreciable assets 76,000 55,000 Accumulated depreciation (40,000 ) (25,000 ) Inventory 90,000 85,000 Deferred tax asset 85,400 30,000 Land 201,000 57,000 Dividend receivable 4,000 $ 753,000 $ 309,000 Additional information At the acquisition date of 80% of its issued shares by Great Ltd, the equity of Wall Ltd was: Share capital (100,000 shares) $100,000 General reserve 3,000 Retained earnings 37,000 Inventory on hand of Wall Ltd at 1 July 2019 included a quantity priced at $10,000 that had been sold to Wall Ltd by its parent. This inventory had cost Great Ltd $7,500. It was all sold by Wall Ltd during the year. In Great Ltd's inventory at 30 June 2020 were various items sold to it by Wall Ltd at $5,000 above cost. During the year, intragroup sales by Wall Ltd to Great Ltd were $60,000. It was also learned that Wall Ltd had sold to Great Ltd an item from its inventory for $20,000 on 1 January 2019. Great Ltd had treated this item as an addition to its plant and machinery. The item was put into service as soon as received by Great Ltd and depreciation charged at 20% p.a. The item had been fully imported by Wall Ltd at a landed cost of $15,000. Management and consulting fees derived by Great Ltd were all from Wall Ltd and represented charges made for administration $2,200 and technical services $2,800. The latter were charged by Wall Ltd to manufacturing expenses. All debentures issued by Wall Ltd are held by Great Ltd. Other components of equity relate to movements in the fair values of the financial assets. The balance of this account at 1 July 2019 was $10,000 (Great Ltd) and $8,000 (Wall Ltd). The tax rate is 30%. Required : Section 1 a)Conduct the acquisition analysis. b)Prepare the consolidation journals as at 30 June 2020. c)What is the total amount of non-controlling interests? d)What is the total amount of Business Combination Revaluation Reserve (BCVR) shown in the group account? e)What is the total amount of Goodwill shown in the group account? In making consolidation worksheet adjustments, sometimes tax-effect entries are made. Why? Make reference to applicable accounting standards and the amounts used in your consolidation workings (at least two examples for each argument are to be provided)