Hi, I have attached the solutions to double check your answers. Please explain each entry, calculations and DR/CR.

Springs Ltd acquired 30% of the share capital of Sandy Ltd at a cost of $20,000 on 1 July 2009. At that date, all the identifiable assets and liabilities of Sandy Ltd were recorded at fair value. The equity of Sandy Ltd at 30 June 2009 consisted of: Share Capital Retained earnings $20,000 10,000 The following financial statement data have been taken from the financial reports of Sandy Ltd: 2011 2012 $20,000 Shareholders' equity as at June 30 Share capital Asset revaluation reserve Retained earnings Total shareholder's equity $20,000 10,000 82.000 112,000 30,000 50,000 Income statement for the year ended 30 June Profit before tax $10,400 Less income tax expense 4,000 Profit after tax for the year 6,400 Dividend paid $5,000 $80,800 20,800 60,000 $8,000 Additional information: (i) (ii) On 31 December 2010, Sandy Ltd sold Springs Ltd a motor vehicle for $24,000. The vehicle had originally cost Sandy Ltd $36,000 and was written down to $18,000 for both tax and accounting purposes at time of sale to Springs Ltd. Both companies depreciated motor vehicles at the rate of 20% per annum on cost. The beginning inventory of Sandy Ltd at 1 July 2011 included goods at $40,000 bought from Springs Ltd; their cost to Springs Ltd was $30,200. The ending inventory of Springs Ltd at 30 June 2012 included goods purchased from Sandy Ltd at a profit before tax of $10,600. The tax rate is 30%. (iii) (iv) Required: Prepare journal entries for consolidation purposes for the year ended 30 June 2012 according to the requirements of AASB 128 Investment in Associates, assuming Springs Ltd is a parent entity. 30% Springs Ltd Sandy Ltd $60,000 840 Profit for the period 2011 2012 Adjustments: Realised profit on motor vehicle 20% * $6 000 (1 - 30%) Realised profit in opening inventory $9 800 (1 - 30%) Unrealised profit in ending inventory $10 600 (1 - 30%) 6 860 (7 420) 60 280 Investor's share -30% $18 084 $20 000 Change in retained earnings 2009 2011 ($30 000 $10 000) Adjustments: Unrealised profit on motor vehicle Profit on sale $6 000 (1 - 30%) less 22 x 20% x $4 200 Unrealised profit in opening inventory $9 800 (1 - 30%) (3 780) (6 860) $9 360 Investor's share -30% $2 808 10 000 Increase in asset revaluation reserve Investor's share -30% 3 000 The consolidation worksheet entries at 30 June 2012: Dr 2 808 Investment in Sandy Ltd Retained earnings Cr 2 808 Dr 18 084 Investment in Sandy Ltd Share of profits or losses of associates Cr 18 084 Dr 2 400 Dividend revenue Investment in Sandy Ltd (30% x $8 000 dividend paid) Cr 2 400 Dr 3 000 Investment in Sandy Ltd Share of OCI of Associates/JVs Cr 3 000 Dr 3 000 Share of OCI of Associates/JVs Asset revaluation surplus Cr 3 000