On 1 January 2017, Dark Ltd acquired all the issued shares (cum div.) of Sam Ltd for

$820 000. At that date, the equity of Sam Ltd was recorded at:

Share capital $500 000

Reserves 200 000

Retained earnings 50 000

On 1 January 2017, the records of Sam Ltd also showed;

Carrying amount Fair value

Land $30000 $ 55000

Further Sam Ltd had a dividend payable of $10 000, the dividend to be paid in March 2017. All other assets and liabilities were carried at amounts equal to their fair values.

Required: Prepare the consolidation worksheet entries on 1 January 2017, immediately after combination (tax rate of 30%)

Part A: Acquisition analysis (2 marks):

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Part B: Business combination valuation entries (2.5 marks):

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Part C: Pre-acquisition entries (3.5marks):