Jimmy Ltd acquired all the issued shares (cum div.) of Nu Ltd on 1 July 2019 for $110000. At this date Jimmy Ltd recorded a dividend payable of $10 000 and equity of:

Share capital $54 000

Retained earnings 36 000

Asset revaluation surplus 18 000

All the identifiable assets and liabilities of Nu Ltd were recorded at amounts equal to their fair values at acquisition date except for:

Carrying amount Fair value

Inventories 14 000 16 000

Machinery (cost $100 000) 92 500 94 000

The machinery was considered to have a further 5-year life. Of the inventory, 90% was sold by 30June2020. The remainder was sold by 30 June 2021.

Both Jimmy Ltd and Nu Ltd use the valuation method to measure the land. At 1 July 2019, the balance of Jimmy Ltd's asset revaluation surplus was $13 500.

In May 2020, Nu Ltd transferred $3 000 from the retained earnings at 1 July 2019 to a general reserve.

The tax rate is 30%.

The following information was provided by the two companies at 30 June 2020.

Consolidation Worksheet at 30 June 2020 Jimmy Ltd ~ Jimmy Ltde Nu Ltd- Adjustments Group Dre Cre Profit before tax 120 000 12 500 Income tax expense (56 000) (4 200) Profit 64 000 8 300 Retained earnings (1/7/19) 80 000 36 000 Transfer from BCVR 144 000 44 300 Transfer to general reserve 0) (3 000) Retained earnings (30/6/20)~ 144 000 41 300 Share capital 360 000 54 000- L LL BCVR General reserved 10 000 3 000 L L 514 000 98 300 Asset revaluation surplus (1/7/19)