On 1 July 2023, Manny Ltd acquired all the issued shares of Chan Ltd for $200,000. The financial statements of Chan Ltd showed the equity of Chan Ltd at that date to be:

Share capital (20,000 * $5 shares)$100,000

General reserve 40,000

Retained earnings 60,000

All the assets and liabilities of Chan Ltd were recorded at amounts equal to their fair values at that date.

During the year ending 30 June 2024, Chan Ltd undertook the following actions.

On 10 September 2023, paid a dividend of $20,000 from the profits earned prior to 1 July 2023 On 28 June 2024, declared a dividend of $20,000 to be paid on 15 August 2024. On 1 January 2024, transferred $15,000 from the general reserve existing at 1 July 2023 toretained earnings.

Required:

a) Prepare the pre-acquisition entries at 1 July 2023.(10 marks)b) Prepare the pre-acquisition entries at 30 June 2024.(10 marks)