On 1st July, 2018 Nile Ltd acquired 70% of the share capital of Amazon Ltd for $80,000,000.

The equity of Amazon Ltd as at the acquisition date was:

Share Capital $ 52,000,000

General Reserve $ 20,000,000

Retained Earnings $ 10,000,000

All assets of Amazon Ltd were recorded at fair value on acquisition, except for one property which had a fair value which was $2,000,000 lower than its' carrying amount. The cost of the property was $20,000,000 with accumulated depreciation of $12,000,000. Ignore Taxes.

Required:

1. (a) Complete the worksheet below using the NET method. (4.5 marks)
2. (b) Prepare the consolidation adjustments and eliminations entries and recognise the NCI in the pre-acquisition equity of Amazon Ltd, assuming that the NCI was measured at the proportionate share of the acquiree's identifiable net assets. (6.5 marks)

Amazon Ltd Nile Ltd 30% NCI Elimination of Investment in Amazon Ltd (S) $,000 (70% of Amazon) $,000 (P) $,000 Fair Value of consideration transferred Less: FV of identifiable assets acquired & liabilities assumed Share capital on acquisition date 52,000 General reserve-acquisition date 20,000 Retained earnings-acquisition date 10,000 Fair value adjustment Goodwill on acquisition Non-controlling interest