On $1$ July $2020,$ Rocky Ltd granted Shores Ltd the right to use its trade name under a

franchise agreement for a period of $7$ years. In terms of the agreement, Shores Ltd must

pay Rocky Ltd an annual licence fee of R$50000.$

The agreement can be terminated if a penalty of R$25000$ is paid. Neither of the two entities

recognised any asset in their own separate financial statements regarding this right.

Shores Ltd is estimated to generate a net R$250000$ income $($additional annual benefits

less expenses, excluding the annual fee for the right$)$ attributable from the use of the trade

name. A market related fee for similar rights is R$45000$ per annum.

On $1$ July $2022,$ Rocky Ltd acquired the entire shareholding $(100\%)$ of Shores Ltd for R$666$

On this date of acquisition, Shores Ltd equity comprised of share capital of R$100000$

and retained earnings of R$83000.$ All identifiable assets and liabilities equalled their fair

values at acquisition.

Additional information:

Assume a pre$-$tax discount rate of $15\%.$

The Income Tax rate is $28\%.$

REQUIRED:

Prepare only the $\text{'}$at acquisition' pro forma journal entry for the Rocky Ltd Group for the

financial year ended $31$ December $2022.$

Dates and narrations are not required.

Show and reference all workings clearly.

Round off to the nearest rand.