1. On 1 January 2019 JGoo Ltd acquired 100% of JBLee Ltd for Ksh.1 billion when JBLee Ltds share capital & reserves amounted to Ksh.700 million. The fair value of JBLee Ltds assets & liabilities as at that date is Ksh.800 million. JBLee Ltd has no contingent liabilities. The Ksh.100 million difference between carrying value and fair value relates to an item of property, plant and equipment with 5 years remaining useful life and nil residual value.

JBLee Limiteds profit for the year ended 31 December 2019 amounted to Ksh.400 million.

In 2019 JBLee Ltd sold inventory, which cost it Ksh.100 million to JGoo Ltd for Ksh.150 million. At 31 December 2019 JBLee Ltd.s inventory included Ksh.60 million inventory bought from JGoo Ltd.

Required:

The proforma journal entries relating to the preparation of consolidated financial statements (12 marks)