On July 1 2013, Regent Ltd acquired 60% of share capital of Prince Ltd for $20,000,000.

Equity of Prince Ltd at acquisition date was:

Share capital $ 18,000,000

General reserve $ 4,000,000

Retained earnings $ 2,000,000

All assets of Prince Ltd were recorded at fair value on acquisition except for an item of machinery that had a higher fair value ($500,000) than its carrying amount. Cost of equipment was $5,000,000 with an accumulated depreciation of $3,000,000.

a)Complete the worksheet below using the NET method.

b)

Elimination of Investment in Prince Ltd	Prince Ltd (S) $,000	Regent Ltd (60% of Prince) (P) $,000	40% NCI $,000
Fair Value of consideration transferred
Less: FV of identifiable assets acquired & liabilities assumed
Share capital on acquisition date	18,000
General reserve-acquisition date	4,000
Retained earnings-acquisition date	2,000
Fair value adjustment
Goodwill on acquisition
Non-controlling interest

Prepare the consolidation adjustments and eliminations entries and to recognise the NCI in the pre-acquisition equity of Prince Ltd.