On 1 July 2019, Naomi Ltd acquired all the issued shares of Ashley Ltd. The recorded equity of Ashley Ltd at this date consisted of: Share capital $ 120000 General reserve 25000 Retained earnings 55000 At 1 July 2019, all the identifiable assets and liabilities of Ashley Ltd were recorded at fair value except for the following assets: Carrying amount Fair value Land $ 100000 $ 130000 Inventories 78500 86100 Machinery (cost $86000) 52000 56000 Vehicles (cost $58000) 47000 53000 At 1 July 2019, Ashley Ltd owned but had not recorded an internally generated brand name. This brand name was considered by Naomi Ltd to have a fair value of $29000 and an indefinite useful life. An impairment test conducted with respect to the brand name on 30 June 2022 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. Inventories on hand at 1 July 2019 were all sold by 31 January 2020. The land owned at 1 July 2019 was sold in September 2020 for $150000. The machinery on hand at 1 July 2019 was sold on 1 January 2022 for $38000. 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. The trial balances of both companies at 30 June 2022 showed the following balances: Debit balances Naomi Ltd Ashley Ltd Cash $ 2500 $ 1250 Receivables 27000 13000 Inventories 39700 24500 Other current assets 15200 8200 Deferred tax assets 7500 3500 Vehicles 88000 158000 Equipment 42000 Land 140000 180000 Financial assets 68000 14800 Intangible assets 28000 15000 Shares in Ashley Ltd 250000 Debentures in Naomi 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 Share capital $ 200000 $ 120000 General reserve 35000 30000 Retained earnings (1/7/21) 51300 67500 Accounts payable 69500 36000 Loan payable (due 30/6/26) 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 (mature 30/6/25) 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 Additional information (a) On 1 January 2022, Naomi Ltd sold an item of equipment to Ashley Ltd for $18000. The equipment had a carrying amount at the date of sale of $21000. Both companies depreciate equipment at 20% p.a. on a straight-line basis. (b) On 1 May 2021, Ashley Ltd sold a machine to Naomi Ltd for $7800. The machine had a carrying amount of $7000 at the date of sale. Naomi Ltd recorded the machine as inventories. In November 2021, the item was sold to an external party for $8200. (c) On 1 July 2020, Naomi Ltd issued 250 $100 debentures to Ashley Ltd with interest at 8% p.a. paid on 30 June and 31 December each year. The debentures are due for redemption on 30 June 2025. (d) During the 202122 financial year, Naomi Ltd sold inventories to Ashley Ltd for $75000. The cost of these inventories to Naomi Ltd was $70000. Of these inventories, 25% are still on hand at 30 June 2022. (e) During the 202122 financial year, Ashley Ltd paid an interim dividend of $5000 to Naomi Ltd and declared a further dividend of $12 000 that has not been paid by year end. (f) The transfer to general reserve recorded by Ashley Ltd in the current year was from retained earnings earned after 1 July 2019. (g) The tax rate is 30%. Submission requirements details: Required Prepare the consolidation worksheet of the Naomi Ltd group for 30 June 2022. Show all workings. 1. Calculate acquisition analysis as at 1 July 2019 2. Prepare the consolidation journal entries for 30 June 2022 3. Complete the consolidated worksheet for 30 June 2022 4. Prepare the consolidated financial statements at 30 June 2022 5. Write a report to explain the consolidation process as per AASB10 for wholly owned entities, explain intragroup adjustments (a) and (c) in additional information above