Gliem QUESTION TWO 2) The following summarized trial balances pertain to Takoradi Lid and its subsidiary Accra Ltd for the year ended 31 December 2018: Takoradi Lid Accrud Debit Credit Debit Credit Glem GHem GHem Sales 5.177 3,996 Cost of sales 3,255 2.448 Operating expenses 713 636 Other income 350 403 288 Share capital (GH 10 each) 3,720 1,600 Share premium 1,430 322 Retained camnings as at January 2018 2,293 516 Tax expenso Current liabilities 713 651 Property, plant and equipment 5,418 1.934 Investments 1.600 Loan to AL's Director 10 Current assets 2.284 1,797 3.683 13,683 7.103 Z.102 Additional information: (1) Takoradi Lid nequired 96 million shares of Acera Lid on May 2018 at following consideration: Cash payment of GHX 450 million and Issuance of 40 million shares of Takoradi Ltd at GHe 25 each On acquisition date, carrying values of Accra Lid's net assets were equal to fair value except the following: A building whose fair values and value-in-use were GH4 390 million and GHE 520 millioa respectively as against carrying value of GHe 480 million. The group follows cost model for subsequent measurement of property, plant and equipment. The remaining life of building on acquisition date was 20 years. Fair value of the building has increased to GH 440 million at 31 December 2018 A brand which had not been recognized by Accm Lid. The fair value of the brand was assessed at GHe 162 million. It is estimated that benefit would be obtained from the brand for the next 6 years (ii) Takordi Lid measures the non-controlling interest at fair value. On the date of acquisition, the market price of Accra Lid's shares was GR 14 per share iv) On 1 July 2018 Takoradi Lod sold an equipment to Accra Lid for GH 250 million at gain of GH 20 million Accra Lid has charged depreciation of GH 12.5 million on this equipment In each month of 2018. Accra Lid sold goods costing GH 40 million to Takoradi Led at cost plus 20%. At year end, 75% of the goxxl purchased in December were included in stock of Takoradi Ltd. (vi) Acer Ltd's credit balance of GH/ 38 million in Takoradi Lid's books does not suree with Accra Lid's books due to GHe 7 million charged by Takoradi Lul for management service on 26 December 2018. Total management fee charged by Takoraci Lidlo Accra Lid since acquisition amounted to GH 16 million will Accra Ltd declared interim cash dividend of GH&0.50 per share in December 2018 Takoradi Ltd has correctly recorded the dividend in its hooks. However, Accro Lid has not yet locounted for the dividend (vili) The incomes and expenses of Acera Lad muy be assumed to have accrued evenly during 3 3 the year Required: Prepare the following: 1. Consolidated statement of profit or loss for the year ended 31 December 2018 Consolidated statement of finicial mition as at 31 December 2018, Gliem QUESTION TWO 2) The following summarized trial balances pertain to Takoradi Lid and its subsidiary Accra Ltd for the year ended 31 December 2018: Takoradi Lid Accrud Debit Credit Debit Credit Glem GHem GHem Sales 5.177 3,996 Cost of sales 3,255 2.448 Operating expenses 713 636 Other income 350 403 288 Share capital (GH 10 each) 3,720 1,600 Share premium 1,430 322 Retained camnings as at January 2018 2,293 516 Tax expenso Current liabilities 713 651 Property, plant and equipment 5,418 1.934 Investments 1.600 Loan to AL's Director 10 Current assets 2.284 1,797 3.683 13,683 7.103 Z.102 Additional information: (1) Takoradi Lid nequired 96 million shares of Acera Lid on May 2018 at following consideration: Cash payment of GHX 450 million and Issuance of 40 million shares of Takoradi Ltd at GHe 25 each On acquisition date, carrying values of Accra Lid's net assets were equal to fair value except the following: A building whose fair values and value-in-use were GH4 390 million and GHE 520 millioa respectively as against carrying value of GHe 480 million. The group follows cost model for subsequent measurement of property, plant and equipment. The remaining life of building on acquisition date was 20 years. Fair value of the building has increased to GH 440 million at 31 December 2018 A brand which had not been recognized by Accm Lid. The fair value of the brand was assessed at GHe 162 million. It is estimated that benefit would be obtained from the brand for the next 6 years (ii) Takordi Lid measures the non-controlling interest at fair value. On the date of acquisition, the market price of Accra Lid's shares was GR 14 per share iv) On 1 July 2018 Takoradi Lod sold an equipment to Accra Lid for GH 250 million at gain of GH 20 million Accra Lid has charged depreciation of GH 12.5 million on this equipment In each month of 2018. Accra Lid sold goods costing GH 40 million to Takoradi Led at cost plus 20%. At year end, 75% of the goxxl purchased in December were included in stock of Takoradi Ltd. (vi) Acer Ltd's credit balance of GH/ 38 million in Takoradi Lid's books does not suree with Accra Lid's books due to GHe 7 million charged by Takoradi Lul for management service on 26 December 2018. Total management fee charged by Takoraci Lidlo Accra Lid since acquisition amounted to GH 16 million will Accra Ltd declared interim cash dividend of GH&0.50 per share in December 2018 Takoradi Ltd has correctly recorded the dividend in its hooks. However, Accro Lid has not yet locounted for the dividend (vili) The incomes and expenses of Acera Lad muy be assumed to have accrued evenly during 3 3 the year Required: Prepare the following: 1. Consolidated statement of profit or loss for the year ended 31 December 2018 Consolidated statement of finicial mition as at 31 December 2018