On 1 April 2010 Parent Ltd acquired 90% ofthe equity in Subsidiary Ltd for $650 000 cash. At this date the equity of Subsidiary Ltd comprised: Share capital Retained earnings S500 000 130 000 Part A (a) Assume the net assets of Subsidiary Ltd were at fair value on 1 April 2010. Prepare the notional journal entry to offset the carrying amount of the asset Investment in Subsidiary Ltd and the parent's portion of equity in Subsidiary Ltd in accordance with the requirements of NZ IFRS 3 Business Combinations and NZ IFRS 10 Consolidated Financial Statements. (b) Assume the net assets of Subsidiary Ltd were not at fair value on 1 April 2010. At the date of acquisition Subsidiary Ltd had an unrecognised intangible asset of $22 000 and a contingent liability of S8 000. Prepare the notional journal entry to offset the carrying amount of the asset Investment in Subsidiary Ltd and the parent's portion of equity in Subsidiary Ltd in accordance with the requirements of NZ IFRS 3 Business Combinations and NZ IFRS 10 Consolidated Financial Statements. (c) Briefly explain why the amount of acquired goodwill recognised above in (a) and (b) will not be the same amount Part B Assume the net assets of Subsidiary Ltd were at fair value on 1 April 2010. Prepare the notional journal entry to identify the non-controlling interest (NCI) in Subsidiary Ltd to be reported in the group accounts as at 31 March 2017 in accordance with the requirements of NZ IFRS 3 Business Combinations and NZ IFRS 10 Consolidated Financial Statements. Parent Ltd measures the NCI at the NCI's proportionate share of the acquiree's identifiable net assets. Additional information provided for Part B: (i) During March 2016 Subsidiary Ltd made sales to Parent Ltd and realised a profit of S2 000. At 31 March 2016 this purchase was included in the inventory balance of Parent Ltd. (ii) During March 2017 Subsidiary Ltd made sales to Parent Ltd and realised a profit of S3 000. Parent Ltd had not sold this purchase of inventory by 31 March 2017 (iii) At the date of consolidation 31 March 2017 the equity of Subsidiary Ltd comprised: Share capital Retained earnings- S500 000 145 000 opening Profit after tax 62 000 35000 172 000 Dividends declared ARS 30 000 Total equity 702 000 (iv) The directors of Parent Ltd believe the acquired goodwill in Subsidiary Ltd was impaired by $4 500 in the year ended 31 March 2017