On 1 June 20X8 Pineapple Ltd acquired 80% of the shares in Banana Ltd. Pineapple offered 3 shares for every 4 shares acquired. The investment in Banana has not been recorded in Pineapple's draft financial statements. On 1 June 20X8 the share price of Pineapple was 4.50 and Banana was 3.25. Banana Ltd had retained earnings of 558,000 on the acquisition date. Statement of Financial Positions as at 31 May 20X9 Non-current assets Property, plant & equipment Investments Current assets Inventories Trade Receivables Cash & bank Total assets Equity Share capital (50p each) Share premium Retained earnings Non-current liabilities Loans Pineapple Ltd '000 '000 Banana Ltd '000 '000 896 490 180 896 670 320 330 228 340 8 2 556 672 1,452 1,342 280 168 58 32 800 600 1,138 800 60 80 264 Current liabilities Trade payables 204 236 Taxation 30 42 234 278 Total Equity and Liabilities 1,452 1,342 Additional information: Banana Ltd's non-current assets include plant with a fair value of 50,000 in excess of its carrying value at the date of acquisition. The fair value increase would create an additional 8,000 annual depreciation charge to the consolidated financial statements. It is group policy to measure non-controlling interests at fair value. Page 3 of 11 During the post-acquisition period, Banana Ltd sold goods to Pineapple Ltd for 30,000 at cost plus 20%. Half of these goods remain in Pineapple Ltd's inventory at the reporting date. Due to the impact of COVID 19, goodwill has been impaired by 12,000. Profits are assumed to accrue evenly during the year. All calculations are to be to 1 decimal place. Required: a) Prepare the consolidated statement of financial position for the Pineapple Group for the year ended 31 May 20X9. b) With reference to IFRS 3 Business combinations, answer the following: i) Explain what the term 'subsidiary' means in the context of consolidated financial statements ii) Under IAS 36 Impairment of assets, an impairment of a non-current asset occurs when the carrying value exceeds its recoverable amount. In terms of assessing when an impairment test is required for tangible and intangible assets, discuss three internal and three external indicators that may be considered at the year-end