Giant Ltd acquired 80 percent share capital of Expert Ltd. On 1 July 2018 for a cost of $1,600,000. As

at the date of acquisition, all assets and liabilities of Expert Ltd were fairly valued except a land that

has a carrying value $150,000 less than the fair value. The recorded balance of equity of Expert Ltd as

at 1 July 2018 were as:

Share capital $800,000

Retained earnings $200,000

General Reserve $400,000

Total $1,400,000

Additional information:

The management of Giant Ltd values non-controlling interest at the proportionate share of Expert

Ltd identifiable net assets.

Expert Ltd has a profit after tax of $200,000 for the year ended 30 June 2019.

During the financial year to 30 June 2019, Expert Ltd sold inventory to Giant Ltd for a price of

$120,000. The inventory costs Expert Ltd $60,000 to produce. 25 percent of the inventory are still

on the hand of Giant Ltd as at 30 June 2019.

During the year Expert Ltd paid $60,000 in consultancy fees to Giant Ltd.

On 1 July 2018, Expert Ltd sold an item of plant to Giant Ltd $80000. The equipment had a carrying

value of $60,000 (Cost $100,000, accumulated depreciation $40,000). At the date of sale, it was

expected that the equipment had a remaining life of 4 years and no residual value.

The tax rate is 30 percent.

Required:

a) Based on the above information, calculate the non-controlling interest as at 30 June 2019.

b) Prepare the necessary journal entries to recognise the non-controlling interest as at 30 June 2019.