gggPeppermint acquired 80% of the share capital of Spearmint two years ago, when the reserves of Spearmint stood at 125,000. Peppermint paid initial cash consideration of 1 million. Additiona lly, Peppermint issued 200,000 shares with a nominal value of 1 and a current market value of 1.80.

It was also agreed that Peppermint would pay a further 500,000 in three years time. Current interest rates are 10% pa. The appropriate discount factor for 1 receivable three y ears from now is 0.751. The shares and deferred consideration have not yet been recorded.

Further information:

(i)at acquisition the fair values of Spearmints plant exceeded its book value by 200,000. The plant ha d a remaining useful life of five years at this date.

(ii)For many years Spearmint has been selling some of its products under the brand name of Mintfresh . At the date of acquisition, the directors of Peppermint valued this brand at 250,000 with a remainin g life of 10 years. The brand is not included in Spearmints statement of financial position

(iii) The consolidated goodwill has been impaired by 258,000.

(iv)The Peppermint Group values the noncontrolling interest using the fair value method. At the date of acquisition the fair value of the 20% noncontrolling interest was 380,000.

Prepare the consolidated statement of financial position as at 31 December 2021

Peppermint Spearmint Equity Share capital 2,0001,4003,4003,0001,2507,6505003008004006501,850 Peppermint Spearmint 000000 NCA PPE 5,5001,500 Investment in Spearmint at cost 1,000 Current assets Inventory 5504002007,650100200501,850