On 1 January 20X4. Plastik acquired 80% of the equity share capital of Subtrak. The consideration was satisfied by a share exchange of two shares in Plastik for every three acquired shares in Subtrak. At the date of acquisition, shares in Plastik and Subtrak had a market value of 53 and $2.50 each respectively. Plastik will also pay cash consideration of 27.5 cents on January 20X5 for each acquired share in Subtrak. Plastik has a cost of capital of 10% per annum. None of the consideration has been recorded by Plastik. Below are the summarised draft financial statements of both companies STATEMENTS OF FINANCIAL POSITION AS AT 30 SEPTEMBER 20X4 Plastik Subtrak 5'000 S000 ASSETS Non-current assets Property, plant and equipment 18,700 13,900 Current assets Inventory (noteid)) 4,300 1,200 Trade receivables 5,700 2.500 Bank 10,000 4,000 Total assets 28,700 17,900 300 9,000 EQUITY AND LIABILITIES Equity Equity shares of SI each Revaluation surplus (note(i)) Retained earnings 10,000 2,000 6,300 18,300 3,500 12,500 2,500 1.000 Non-current liabilities 10% loan notes Current liabilities Trade payables Bank Current tax payable 3,600 3,400 1.700 2,800 7,900 28,700 800 4,400 17,900 Total equity and liabilities The following information is relevant: i. At the date of acquisition, the fair values of Subtrak's assets and liabilities were equal to their carrying amounts with the exception of Subtrak's property which had a fair value of $4 million above its carrying amount. For consolidation purposes, this led to an increase in depreciation charges of $100,000 in the post-acquisition period to 30 September 20X4. Subtrak has not incorporated the fair value property increase into its entity financial statements. The policy of the Plastik group is to revalue all properties to fair value at each year end. On 30 September 20X4, the increase in Plastik's property has already been recorded, however, a further increase of $600,000 in the value of Subtrak's property since its value at sicquisition and 30 September 20X4 has not been recorded it. Sales from Plastik to Subtrak throughout the year ended 30 September 20X4 had consistently been $300,000 per month, Plastik made a mark-up on cost of 25% on all iii. iv. these sales. $600,000 (at cost to Subtrak) of Subtrak's inventory at 30 September 20X4 had been supplied by Plastik in the post-acquisition period. Plastik's policy is to value the non-controlling interest at fair value at the date of acquisition. For this purpose Subtrak's share price at that date can be deemed to be representative of the fair value of the shares held by the non-controlling interest. Due to recent adverse publicity concerning one of Subtrak's major product lines, the goodwill which arose on the acquisition of Subtrak has been impaired by $500,000 as at 30 September 20X4. Goodwill impairment should be treated as an administrative expense Assume, except where indicated otherwise, that all items of income and expenditure accrue evenly throughout the year. Subtrak earned a loss of $1,000 in the year ended 30 September 20X4. No any dividends was paid by Subtrak. V. Required: Prepare the consolidated statement of financial position for Plastik for the year ended 30 September 20X4