item Aspect Event Data 1 Acquisiton of Subsidiary by Parent Acquisiton date of Subsidiary by the Parent 1/07/2X18 2 % ownership of Parent in Subsidiary 76 3 Subsidiary Share Capital at acquisition date $1,500,000 4 Subsidiary Retained Earnings at acquisition date $301,750 5 Fair value adjustment at acquisition date At acquisiton date, the fair value of Plant Touch-U in Subsidiary is $1,850 6 Cost of Plant Touch-Uis $1,550 7 At acquisition date, accumulated Depreciation of Plant Touch-U $1,150 8 At acquision date, the remaining useful life in years of Plant Touch U 4 9 Intra-group servicetransaction Subsidiary pays management fees to Parent during the financial year. This item is included in 'other' income and expenses 6750 10 Intra-group inventory transaction:

Parent sell inventory (Type-High) to subsidiary in current period During the current financial year Parent Ltd sold inventory to Subsidiary Ltd at a price of $28,500 11 The inventory cost Parent to produce $20,500 12 % of this inventory is still on hand with Subsidiary Ltd at the end of the financial year. 90 13 Intra-group inventory transaction:

Subsidiary sell inventory (Type-Low) to Parent in current period During the current financial year Subsidiary Ltd sold inventory to Parent Ltd at a price of 27,000 14 The inventory cost Subsidiary to produce $21,000 15 % of this inventory is still on hand with Parent Ltd at the end of the financial year. 80 16 Intra-group inventory transaction: Subsidiary sell inventory (Type Rich) to Parent in previous period brought into the current period During the current financial year Subsidiary Ltd sold inventory to Parent Ltd at a price of $18,000 17 The inventory cost Subsidiary to produce $15,000 18 % of this inventory is still on hand with Parent Ltd at beginning of the financial year 90 19 Goodwill impairment Parent Ltd Management believes goodwill has impaired in the previous years by $13,000 20 Parent Ltd Management believes goodwill has further impaired in the current period years by $3,000 21 Intra-group depreciable non-current asset (Plant-Steel-Ball) transaction:

Subsidiary sell non current asset to Parent in current period Beginnig of the current year, Subsidiary Ltd sold an item of plant-hard to Parent Ltd for a price of $48,500 22 Cost of the plant-hard at the time of intra-group transaction is $53,500 23 Accumulated depreciation of the plant-hard at the time of intra-group transaction is $28,500 24 Remaining useful life of the plant-hard at the time of sale with no expected residual value, in years 10 25 Intra-group depreciable non-current asset (Plant-Aluminium-Spade) transaction:

Parentsell non current asset to Subsidiaryin previous period Beginnig of the previous year, Parent Ltd sold an item of plant-happy to Subsidiary Ltd for a price of 45,100 26 Cost of that item of plant-happy at the time of intra-group transaction is $50,100 27 Accumulated depreciation of the plant-happy at the time of intra-group transaction is $25,100 28 Remaining useful life of the plant-happy at the time of sale with no expected residual value, in years 5 29 Income tax rate as % is 30 30 Note The management of Parent Ltd values any non-controlling interest in Subsidiary Ltd at fair value Marking Criteria Category Marks Correctly completing consolidation journal entries 63 Linking each journal item to the adjustment columns on the group financial statements 63 Non controlling inerest at the date of acquisition 4 Non controlling inerest from the date of acquisition to the beginning of the period 10 Non controlling intereest during the current period 14 Summay table completion of non controlling interest 5 Group income statement 12 Group balance sheet 21 Journal reference number in the Group income statement reference columns 30 Journal reference number in the Group balance sheetreference columns 30 Group statemet of changes in equity 8

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Detailed reconciliation of opening and closing retained earnings Parent Ltd Subsidiary Ltd Consolidation adjustments Consolidated entity Ref No Dr Dr Dr Dr Dr Dr Dr Dr Ref No Cr Cr Cr Cr Cr Cr Cr Cr Sales revenue $480,000 $115,000 $595,000 Cost of goods sold -$100,000 -$40,000 -$140,000 Other expenses -$80,000 -$15,000 -$95,000 Goodwill impairment expense $0 Other revenue $70,000 $25,000 $95,000 Gain on bargain purchase $0 Profit before tax $370,000 $85,000 $455,000 Tax expense -$60,000 -$30,000 -$90,000 Profit for the year $310,000 $55,000 $365,000 Retained earningsbeginning of year $1,000,000 $800,000 $1,800,000 Retained earnings available for distribution $1,310,000 $855,000 $2,165,000 Dividends paid -$160,000 -$30,000 -$190,000 Dividend declared -$40,000 -$10,000 -$50,000 Retained earnings30 June 2X20 $1,110,000 $815,000 $1,925,000 Statement of financial position Parent Ltd Subsidiary Ltd Consolidation adjustments Consoiidated entity Shareholders' equity Ref No Dr Dr Dr Dr Dr Dr Dr Dr Ref No Cr Cr Cr Cr Cr Cr Cr Cr Shareholders' equity Revaluation and other reserves 0 Retained earnings $1,110,000 $815,000 $1,925,000 Share capital $4,000,000 $1,500,000 $5,500,000 Current liabilities Current liabilities Accounts payable $20,000 $30,000 $50,000 Dividends payable $40,000 $10,000 $50,000 Deferred tax liability 0 Non-current liabilities Non-current liabilities Loans $600,000 $250,000 $850,000 Deferred tax liability 0 Total of liabilities and equity $5,770,000 $2,605,000 $8,375,000.00 Current assets Current assets Cash $150,000 $25,000 $175,000 Accounts receivable $242,000 $175,000 $417,000 Dividends receivable $8,000 $0 $8,000 Inventory $500,000 $300,000 $800,000 Deferred tax asset 0 Non-current assets Non-current assets Land $1,400,000 $1,105,000 $2,505,000 Plant $1,870,000 $1,300,000 $3,170,000 Accumulated depreciation -$400,000 -$300,000 -$700,000 Deferred tax asset $0 Goodwill on acquistion $0 Accumulated goodwill impairment $0 Investment in Subsidiary Ltd $2,000,000 $0 $2,000,000 Total assets $5,770,000 $2,605,000 $8,375,000 0.00 Statement of Changes in Equity Description Share capital $ Retained earnings $ Reserves $ Group $ Balance at 1 July 2019 Total comprehensive income for the year Dividends Balance at 30 June 2020 Ref No Dr/Cr Consolidation journal account name 1 Consolidation journal entries for the fair value adjustment of the Plant-Touch U in SubsidiaryLtd and the resulted tax effect Debit $ Credit $ 2 Consolidation journal entries relating to pre-tax depreciation entry resulting because of fair value adjustment of the Plant-Touch-U asset Debit $ Credit $ 3 Consolidation journal entries relating to tax effect result from the depreciation entry resulting because of fair value adjustment of the Plant-Touch-U to prepare group accounts for the current year Debit $ Credit $ 4 Consolidation journal entries for the elimination of Parent Ltd's investment in Subsidiary Ltd Debit $ Credit $ 5 Consolidation journal entries relating to the management fees for the current year Debit $ Credit $ 6 Consolidation journal entries relating intra-group inventory-Type High transactions and its tax effects Debit $ Credit $ 7 Consolidation journal entries relating intra-group inventory-Type Low transactions and its tax effects Debit $ Credit $ 8 Consolidation journal entries relating intra-group inventory (coming from the previous period)-Type Rich transactions and its tax effects Debit $ Credit $ 9 Consolidation journal entries relating to impairment of goodwill. Debit $ Credit $ 10 Consolidation journal entries relating intra-group plant-Steel-Ball transactions and its tax effects Debit $ Credit $ 11 Consolidation journal entries relating intra-group Plant-Aluminium-Spade transactions and its tax effects Debit $ Credit $ 12 Consolidation journal entries relating to intra-group dividends. Debit $ Credit $ 13 Itemise and show the non-controlling interests in Subsidiary Ltd on acquisition date Credit $ Share capital Retained earnings Revaluation surplus Goodwill Total 0.00 14 Itemise and show the non-controlling interest movements in share capital and reserves between the acquisition date and beginning of the current financial year Credit $ Increase in retained earnings from acquisition date to beginning of year Additional depreciation expense due to revaluation of Plant Touch-U Additional income tax expense due to previous period depreciation expense from revaluation of Plant Touch-U Previous period intra-group cost of sale of Type-Rich inventory Previous period intra-group cost of sale of Type-Rich inventory - income tax Impairment expense of goodwill in previous period Previous period intra-group gain on sale of Plant Aluminum-Spade Previous period intra-group gain on sale of Plant Aluminum-Spade - income tax Additional depreciation expense due to previous period intra-group sale of Plant Aluminum-Spade Additional income tax expense due to previous period depreciation expense from intra-group sale of Plant Aluminum-Spade Total 0.00 15 Itemise and show the non-controlling interests of the Parent Ltd Group for the current financial year Credit $ Profit after tax for the year Depreciation expense from revaluation of Plant Touch-U Income tax expense from depreciation expense of revaluation of Plant Touch-U Intra-group cost of sale of Type-Low inventory Intra-group cost of sale of Type-Low inventory - income tax Intra-group cost of sale of Type-Rich inventory Intra-group cost of sale of Type-Rich inventory - income tax Impairment expense of goodwill Intra-group gain on sale of Plant Steel-Ball Intra-group gain on sale of Plant Steel-Ball - income tax Depreciation expense from intra-group sale of Plant Steel-Ball Income tax expense from depreciation expense of intra-group sale of Plant Steel-Ball Depreciation expense from intra-group sale of Plant Aluminum-Spade Income tax expense from depreciation expense of intra-group sale of Plant Aluminum-Spade Total 0.00 16 Comppute the total non-controlling interest (NCI Credit $ NCI at acquisition NCI from acquisition to beginning of year NCI during the year Interim dividend Final dividend Total NCI in the group 0.00