H Limited acquired 80 000 ordinary shares in S Limited on 1 January 20.8 for R140 000. The owners’ equity of S Limited at that date was as follows:

Share capital - 100 000 ordinary shares at R 100 000

Retained earnings - R 50 000

On this date the assets and liabilities were considered to be fairly valued and there were no unaccounted for contingent liabilities.

2. The retained earnings of S Limited amounted to R150 000 at 1 January 20.9. 3.

3. At 31 December 20.9 the goodwill of S Limited had been impaired to R5 000.

4. The profit for the year of S Limited was R30 000.

5. The group applies the full goodwill method to account for goodwill.

6. The fair value of the non-controlling interest on 1 January 20.8 was R35 000.

Prepare the following:

a) The analysis of owners’ equity at acquisition.

b) The pro forma consolidation journal entries for the year ended 31 December20.9.