On 1st July 20X7 Parent Ltd acquired all of the share capital of Controlled Ltd for $487,500.

As that date equity of Controlled Ltd was:

Share Capital $300,000

General Reserve $60,000

Retained Earnings $70,000

Consolidation worksheet 30 June 20X2	Dr./Cr	Parent Ltd	Controlled Ltd	Elimination		Consolidated Statement
				Dr	Cr
Sales	Cr	4,000,000	2,200,000
Cost of goods sold	Dr	2,300,000	1,000,000
Gross profit	Cr	1,700,000	1,200,000
Dividend from Controlled Ltd	Cr	30,000
Profit from sale of plant	Cr		6,000
Interest from Controlled Ltd	Cr	11,000
		1,741,000	1,206,000
Selling expenses	Dr	121,500	86,000
Administrative expenses	Dr	400,000	250,000
Financial expenses	Dr	362,000	220,000
Profit before tax	Cr	857,500	650,000
Less: Income tax	Dr	340,000	260,000
Profit	Cr	517,500	390,000
Retained earnings 1-07-20X8	Cr	400,000	250,000
Available		917,500	640,000
Less Appropriation:
Interim dividend paid	Dr	60,000	30,000
Declared dividend	Dr	90,000	45,000
To General reserve	Dr		5,000
Total appropriation	Dr	150,000	80,000
Retained earnings 30-06-20X9	Cr	767,500	560,000
Share capital	Cr	600,000	300,000
General reserve	Cr	240,000	100,000
Dividend payable	Cr	90,000	45,000
Current tax payable	Cr	340,000	260,000
Payable	Cr	112,500	25,000
Non-current liabilities	Cr	200,000	60,000
		2,350,000	1,350,000
Land and building	Dr	450,000	250,000
Motor vehicle (net)	Dr	130,000	60,000
Plant and equipment (net)	Dr	500,000	400,000
Investment in Controlled Ltd	Dr	457,500	-
Receivable	Dr	200,000	300,000
Inventory	Dr	300,000	150,000
Bank	Dr	312,500	190,000
Goodwill on consolidation	Dr	-	-
Accumulated impairment-goodwill	Dr	-	-
		2,350,000	1,350,000

Additional Information:

- Sales by Controlled Ltd to Parent Ltd were $60,000

- Unrealized profit in the opening inventory of Controlled Ltd for goods sold by Parent Ltd was $2,000.

- Unrealized profit in the closing inventory of Parent Ltd for goods sold by Controlled Ltd was $4,000

- On 1st July, 20X8 Controlled Ltd sold plant to Parent Ltd for $60,000. At the date of sale the plant had a written-down value of $54,000. Parent Ltd depreciates plant at 10% per annum on cost using the straight-line method.

- Impairment of goodwill:

Year ended 30 June 20X8 $5,500

Year ended 30 June 20X9 $5,500

Required: For year ended 30 June, 20X9

a. Consolidation journal entries

b. The consolidation worksheet, and

c. Consolidated financial statement