On 1 July 2013 William Ltd acquired all of the share capital (cum div)of Magnus Limited for a consideration of $600,000 cash and a brand that was held in their accounts at a book value of $10,000 but now had a fair value of $24,000. At the date of acquisition Magnus's accounts showed a dividend payable of $10,000. At that date all the identifiable assets and liabilities were recorded at fair value with the exception of: ASSET Book Value Market Value Inventory 16,000 18,000 Land 65,000 68,000 Plant 17,000 (less depn) (2000) 15,000 19,000 Acounts Receivable 15,000 14,000 The inventory was all sold by 30\/6\/14. The remaining useful life of the plant is 5 years. The accounts receivable were collected by 30\/6\/14 for $14,000 The land was sold on 30\/12\/16 for $70000. The plant was on hand still at 30\/6\/17. At the date of acquisition the equity of William Ltd consisted of: Share Capital 380,000 General Reserve 70,000 Retained Earnings 62,000 Information from the trial balances of Magnus Ltd and William Ltd at 30 June 2017 is presented overleaf. Additional Information 1. On 1 Jan 2017 William Ltd sold inventory to Magnus Ltd costing $70,000 for $80,000. Half of this inventory was sold to outside parties by 30\/6\/17. 2. On 1 Jan 2016 William Ltd sold inventory costing $12000 to Magnus Ltd for $15,000. Magnus Ltd treats the item as equipment and depreciates it at 10% per annum. 3.On 1 July 2016 William sold plant to Magnus for $21,000. The plant had cost William $24,000 on 1 July 2014 and it was being depreciated at 10% per annum. Magnus regards the plant as inventory. The inventory was all sold by 30th July 2016. 4. At 1 July 2016 William Ltd held inventory that it had purchased from Magnus Ltd on 1 June 2016 at a profit of $5000. All inventory was sold by 30 June 2017 5. Magnus Ltd accrues dividends from William Ltd once they are declared. 6. Magnus Ltd has earned $1600 in interest revenue in the 2017 financial year from William Ltd. 7. Magnus Ltd has earned $3500 in service revenue in the 2017 financial year from William Ltd. 8. Assume a tax rate of 30%.<\/p>
Prepare the consolidation worksheet for the preparation of the consolidated financial statements for the period ended 30 June 2017.<\/p>", "transcribed_text": "", "related_book": { "title": "Principles Of Finance", "isbn": "979-8439388899", "edition": "1st Edition", "authors": "Julie Dahlquist, Rainford Knight", "cover_image": "https:\/\/dsd5zvtm8ll6.cloudfront.net\/si.question.images\/book_images\/6290aa2348f9a_11251.jpg", "uri": "\/textbooks\/principles-of-finance-1st-edition-9798439388899", "see_more_uri": "" }, "free_related_book": { "isbn": "1771886501", "uri": "\/textbooks\/the-science-of-small-arms-ballistics-1st-edition-9781771886505-9781351377362", "name": "The Science Of Small Arms Ballistics", "edition": "1st\u00a0Edition" }, "question_posted": "2024-06-29 02:10:41", "see_more_questions_link": "\/study-help\/questions\/business-economics-2023-September-08", "step_by_step_answer": "The Answer is in the image, click to view ...", "students_also_viewed": [ { "url": "\/there-are-two-cavities-fig.-5.39-with-small-holes-of", "description": "There are two cavities (Fig. 5.39) with small holes of equal diameters d = 1.0 cm and perfectly reflecting outer surfaces. The distance between the holes is l = 10 cm. A constant temperature T1 =...", "stars": 3 }, { "url": "\/study-help\/business-statistics-in-practice\/39-managers-hourly-wages-what-affects-marketing-managers-hourly-wages-1982282", "description": "=+39. Managers hourly wages. What affects marketing managers hourly wages? To find out, mean hourly wages were retrieved from the U.S. Bureau of Labor Statistics for two managerial occupations in...", "stars": 3 }, { "url": "\/a-study-found-that-in-2005-125-of-us-workers", "description": "A study found that, in 2005, 12.5% of U.S. workers belonged to unions (The Wall Street Journal, January 21, 2006). Suppose a sample of 400 U.S. workers is collected in 2006 to determine whether union...", "stars": 3 }, { "url": "\/study-help\/questions\/write-the-equations-of-non-constant-polynomials-f-and-9859750", "description": "Write the equations of non - constant polynomials f and g so the limit of f ( x ) g ( x ) = - at x = 2 .", "stars": 3 }, { "url": "\/study-help\/questions\/on-november-1-2020-seef-trading-entered-into-an-agreement-5848636", "description": "On November 1, 2020. SEEF Trading entered into an agreement by signed a 90 day, 6 note payable with a face value of 80 50 000 How michepen is bumber this note? (Uso 350 days a year) O A BDO OB BD...", "stars": 3 }, { "url": "\/study-help\/questions\/differentiate-tan7x9x25-9070330", "description": "Differentiate tan(7x+9x-2.5)", "stars": 3 }, { "url": "\/study-help\/questions\/explain-the-sources-of-recruitment-9070331", "description": "Explain the sources of recruitment.", "stars": 3 }, { "url": "\/study-help\/questions\/differentiate-sin5x2-9070332", "description": "Differentiate sin(5x+2)", "stars": 3 }, { "url": "\/study-help\/questions\/compute-the-derivative-fx1axbx-9070333", "description": "Compute the derivative f(x)=1\/ax+bx", "stars": 3 }, { "url": "\/study-help\/questions\/what-is-the-meaning-of-strategic-management-and-what-are-9070334", "description": "What is the meaning of strategic management and what are their objectives and advantages of strategic management?", "stars": 3 } ], "next_back_navigation": { "previous": "\/study-help\/questions\/exercise-59-the-current-assets-and-current-liabilities-sections-of-4446058", "next": "\/study-help\/questions\/student-age-housing-academic-program-likely-to-attend-umgc-1-4446060" }, "breadcrumbs": [ { "name": "Study help", "link": "https:\/\/www.solutioninn.com\/study-help\/questions-and-answers" }, { "name": "Business", "link": "https:\/\/www.solutioninn.com\/study-help\/questions-and-answers\/business" }, { "name": "Accounting", "link": "https:\/\/www.solutioninn.com\/study-help\/questions\/business-accounting" }, { "name": "On 1 July 2013 William Ltd acquired all of the share capital", "link": "https:\/\/www.solutioninn.com\/study-help\/questions\/on-1-july-2013-william-ltd-acquired-all-of-the-4446059" } ], "skill_details": { "skill_id": "9", "skill_name": "Accounting", "parent_id": "1" } }1" } }