On 1 July 2013, Sculptor Ltd acquired all the share capital (cum div.) of Virgo Ltd, giving in exchange 50 000 shares in Sculptor Ltd, these having a fair value at acquisition date of 5 per share. Costs incurred in undertaking the acquisition amounted to 10 000. The dividend payable at the acquisition date was paid in September 2013. At 30 June 2013, the statement of financial position of Virgo Ltd was as follows:

Statement of Financial Position As at 30 June 2013
Plant and equipment	218 000	Share capital (150 000 shares)	150 000
Intangibles	6 000	Retained earnings	84 000
Current assets	44 000	Dividend payable	10 000
		Other liabilities	24 000
	268 000		268 000

The recorded amounts of the identifiable assets and liabilities of Virgo Ltd at the acquisition date were equal to their fair values. Virgo Ltd had not recorded an internally developed trademark. Sculptor Ltd valued this at 20 000. It was assumed to have a 4-year life. The tax rate is 30%.

Required

1. Show the journal entries in the separate financial statements of Sculptor Ltd and determine the cost of investment in Virgo Ltd.

2. Calculate the goodwill or gain on bargain purchase for the acquisition of Virgo Ltd

3. Prepare the consolidation entries for the preparation of consolidated financial statements at 1 July 2013.

4. Explain and justify if the internally developed trademark should be capitalized in the individual and group financial statements.

5. Prepare the consolidation entries for the preparation of consolidated financial statements at 30 Jun 2017.