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On 1 July 2019, Besar Ltd acquired all of the shares (cum div.) of Kecil Ltd. The statement of financial position provided by the two

On 1 July 2019, Besar Ltd acquired all of the shares (cum div.) of Kecil Ltd. The statement of financial position provided by the two companies at 1 July 2019 is as follows:

Besar Ltd

Kecil Ltd

Shares in Kecil Ltd

367,000

-

Plant

230,000

320,000

Accumulated depreciation

(120,000)

(40,000)

Land

-

12,000

Goodwill

10,200

2,000

Inventory

30,000

51,000

Receivables

40,000

42,000

557,200

387,000

Share capital

280,000

200,000

General reserve

44,000

33,000

Retained earnings

131,200

134,000

Liabilities

102,000

20,000

557,200

387,000

At the date of the business combination, all the identifiable assets and liabilities of Kecil Ltd had carrying amounts equal to their fair values except for:

Fair value

Plant

$300,000

Inventory

31,000

Receivables

43,000

The plant had a further useful life of 5 years. It was sold by Kecil Ltd on 1 January 2021 for $3,000.

By 30 June 2020, all the inventory was sold to entities outside the group at a loss of $5,000. The receivables of $43,000 has been collected by 30 June 2021.

One of the liabilities of Kecil Ltd at 1 July 2019 was dividend payable of $10,000.

Besar Ltd uses the partial goodwill method.

The tax rate is 30%.

Additional information

For the year ended 30 June 2021, Kecil Ltd also reported a comprehensive income for the year of $800, which included gains on revaluation of land of $250 as the asset revaluation surplus in relation to the land.

Required

Prepare the consolidation worksheet entries for the preparation of the consolidated financial statements of Besar Ltd at 30 June 2021 in accordance to IFRS 10/AASB 10 Consolidated Financial Statements and IFRS 3/ AASB 3 Business Combinations. Workings and narrations are required.

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