Just Prepare the acquisition analysis at 1 July 2013.

Trial Balances As at 30 June 2017 Ross Lto Zara Ltd DR CR DR CR Sales Revenue 1,455,000 1,075,000 Cost of Sales 650,000 325,000 Wages and Salaries 253,000 215,000 Depreciation Expense 17,000 8,000 Service Expense 3,500 4,800 Interest Expense 9,300 5,600 Other Expenses 4,000 5,000 Gain on Sale of Non Current Assets 40,000 Service Revenue 5,600 5,000 Interest Revenue 1,200 7,000 Dividend Revenue 9,500 Income tax expense 162,000 169,000 Retained Earnings 1/7/16 190,820 85,000 Dividend Paid 12,000 5,000 Dividend Declared 16,000 1,500 Share Capital 300,000 500,000 General Reserve 90,000 60,000 Other Equity 1/7/16 4,000 12,000 Gains on Financial Assets (OCI) 1,000 6,000 Loan Payable to Ross Ltd 25,000 Deferred Tax Liability 1,900 6,480 Dividend Payable 16,000 4,500 Shares in Zara Ltd 90,000 Cash 86,000 64,080 Inventories 169,500 291,000 Other Current Assets 11,000 100,000 Dividend Receivable 4,500 Loan receivable from Zara Ltd 25,000 Financial Assets 18,000 68,000 Plant and Equipment 450,000 500,000 Acc. Depreciation Plant 90,000 120,000 Land 87,220 180,000 Deferred Tax Asset 2,668,020 2,668,020 1,945,980 1,945,980On 1 July 2013 Ross Ltd acquired all of the share capital (cum div)of Zara Limited for a consideration of $650,000 cash and PPE with a fair value of $50,000. At the date of acquisition Zara's accounts showed a dividend payable of $10,000. At acquisition date all the identifiable assets and liabilities were recorded at fair value with the exception of: ASSET Book Value Market Value Inventory 15,000 16,000 Land 110,000 135,000 Plant 18,000 (less depn) (2000) 16,000 19,000 Acounts Receivable 20,000 18,000 The inventory was all sold by 30/6/14. The remaining useful life of the plant is 5 years. The accounts receivable were collected by 30/6/14 for $18,000. The land was sold on 30/12/16 for $150000. The plant was on hand still at 30/6/17. At the date of acquisition the equity of Zara Ltd consisted of: Share Capital 500,000 General Reserve 60,000 Retained Earnings 75,000 Information from the trial balances of Zara Lid and Ross Ltd at 30 June 2017 is presented overleaf. Additional Information 1. On 1 Jan 2017 Ross Ltd sold inventory to Zara Ltd costing $40,000 for $60,000. Half of this inventory was sold to outside parties by 30/6/17. 2. On 1 Jan 2016 Ross Ltd sold inventory costing $13000 to Zara Ltd for $18,000. Zara Ltd treats the item as equipment and depreciates it at 10% per annum. 3.On 1 July 2016 Ross sold plant to Zara for $25,000. The plant had cost Ross $28,000 on 1 July 2014 and it was being depreciated at 10% per annum. Zara regards the plant as inventory. The inventory was all sold by 30th July 2016. 4. At 1 July 2016 Ross Led held inventory that it had purchased from Zara Ltd on 1 June 2016 at a profit of $3600. All inventory was sold by 30 June 2017 5. Zara Ltd accrues dividends from Ross Ltd once they are declared. 6. Zara Ltd has earned $600 in interest revenue in the 2017 financial year from Ross Ltd. 7. Zara Ltd has earned $4000 in service revenue in the 2017 financial year from Ross Ltd. 8. Assume a tax rate of 30%