On 1 July 2016, Rock Ltd acquired (ex div.) all of the issued capital of Wallaby Ltd. The recorded equity of Wallaby Ltd at this date consisted of:

Share capital$120 000

General reserve25 000

Retained earnings55 000

At 1 July 2016, all the identifiable assets and liabilities of Wallaby Ltd were recorded at fair

value except for the following assets:

CaCarrying amountca

Fair valuF

Land

$100000

$130000

Inventory

78500

86100

Machinery (cost $86000)

52000

56000

Vehicles (cost $58000)

47000

53000

Additionally, Wallaby Ltd's records showed a dividend payable at 1 July 2016 of $8000. This

dividend was paid on 31 October 2016. The assets of Wallaby Ltd at acquisition date included

goodwill recorded at $15 000 arising from a business combination transaction in 2012.

At 1 July 2016, Wallaby Ltd owned but had not recorded an internally generated brand name.

This brand name was considered by Rock Ltd to have a fair value of $29 000 and an indefinite

useful life. An impairment test conducted with respect to the brand name on 30 June 2019 concluded that its recoverable amount at that date was $2000 less than its carrying amount.

The vehicles and machinery were expected to have a further useful life of 6 and 8 years respectively, with benefits to be received evenly over those periods. Inventory on hand at 1 July 2016 was all sold by 31 January 2017. The land owned at 1 July 2016 was sold in September 2017 for $150 000.

The machinery on hand at 1 July 2016 was sold on 1 January 2019 for $38 000.

Adjustments for the differences between carrying amounts and fair values of assets and liabilities on hand at acquisition date are recognised on consolidation. When assets are sold or derecognised, any related valuation reserves are transferred to retained earnings.

In June 2018, Wallaby Ltd paid a share dividend worth $20 000 from the general reserve on hand at 1 July 2016.

The trial balances of both companies at 30 June 2019 showed the following balances:

Cash

$2500

$1250

Receivables

27000

13000

Inventory

39700

24500

Other current assets

15200

8200

Deferred tax assets

7500

3500

Vehicles

88000

158000

Equipment

42000

Land

140000

180000

Financial assets

68000

14800

Goodwill

28000

15000

Shares in Wallaby Ltd

250000

Debentures in Rock Ltd

25000

Dividend paid

10000

5000

Dividend declared

20000

12000

Transfer to general reserve

10000

5000

Cost of sales

210000

192550

Income tax expense

30000

32000

Depreciation and other expenses

39000

36000

Carrying amount of machinery sold

30500

Carrying amount of equipment sold

21000

$1005900

$798300

Credit balances

Rock Ltd

Wallaby Ltd

share capital

$200000

$140000

General reserve

35000

10000

Retained earnings (1/7/18)

51300

67500

Accounts payable

69500

36000

Loan payable (due 30/6/23)

25000

15000

Dividend payable

20000

12000

Provisions

12500

9300

Current tax liability

43000

34000

Deferred tax liability

11800

5000

Accumulated depreciation - vehicles

16400

60000

Accumulated depreciation - equipment

34500

8% Debentures (matures 30/6/22)

25000

Sales revenue

450000

320000

Dividend revenue

17000

Other income

11400

17000

Proceeds on sale of equipment

18000

Proceeds on sale of machinery

38000

$1005900

$798300

Required

Prepare the consolidation worksheet journal entries for the preparation of the consolidated financial statements of Rock Ltd at 30 June 2019.