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On October 1,2021 , Pangani Ltd acquired 90,000,000 of Segera Ltd's 150,000,000 TZS 1 equity shares. The acquisition was achieved through a share exchange of

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On October 1,2021 , Pangani Ltd acquired 90,000,000 of Segera Ltd's 150,000,000 TZS 1 equity shares. The acquisition was achieved through a share exchange of one share in Pangani Ltd for every three shares in Segera Ltd. At that date the stock market prices of Pangani Ltd's and Segera Ltd's shares were TZS 4/= and TZS 2.50 per share respectively. Additionally, Pangani Ltd will pay TZS 1.54 cash on September 30,2022 for each share acquired. Pangani Ltd's finance cost is 10% per annum. The retained earnings of Segera Ltd brought forward at April 1, 2021 were TZS 120,000,000/=. The summarised statements of profit or loss and other comprehensive income for the companies for the year onded March 31, 2022 are: The following information is relevant: (i) A fair value exercise conducted on October 1, 2021 concluded that the carrying amounts of Segera Lid's net assets were equal to their fair values with the following exceptions: - The fair value of Segera L.td's land was TZS 2,000,000/= in excess of its carrying amount; - An item of plant had a fair value of TZS 6,000,000/= in excess of its carrying amount. The plant had a remaining life of two years at the date of acquisition. Plant depreciation is charged to cost of sales. - Pangani Ltd placed a value of TZS 5,000,000/ a on Segera Ltd's good trading relationships with its customers. Pangani Ltd expected, on average, a customer relationship to last for a further five years. Amortisation of intangible assets is charged to administrative expenses (ii) Pangani group policy is to revalue land to market value at the end of each bcoounting period. Prior to its acquisition, Segera L.td's land had been valued at historical cost, but it has adopted the group policy since its acquisition. In addition to the fair value increase in Segera Lid's land of TZS 2,000,000/= (see note (i)), it had increased by a further TZS 1,000,000/a since the acquisition. (iii) On October 1, 2021, Pangani Ltd also acquired 30% of Korogwe Ltd's equity shares. Korogwe Ltd's profit after tax for the year ended March 31, 2021 was TZS 10,000,000/= and during March 2021 Korogwe Ltd paid a dividend of TZS 6,000,000/=. Pangani uses equity accounting in its consolidated financial statements for its investment in Korogwe Ltd. Segera Ltd did not pay any dividends in the year ended March 31, 2022. (iv) After the acquisition Pangani Ltd sold goods to Segera Ltd for TZS 20,000,000/= Segera Lid had one fifth of these goods still in inventory at March 31, 2022. In March 2022 Pangani Ltd sold goods to Korogwe Ltd for TZS 15,000,000/=, all of which were still in inventory at March 31, 2022. All sales to Segera Ltd and Korogwe Ltd had a mark-up on cost of 25%. (v) Pangani Ltd's policy is to value the non-controlling interest at the date of acquisition at its fair value. For this purpose, the share price of Segera Ltd at that date (October 1,2021 ) is representative of the fair value of the shares held by the non-controlling interest. (vi) All items in the above statements of profit or loss and other comprehensive income are deemed to accrue evenly over the year unless otherwise indicated. Required: (a) Caiculate the consolidated goodwill as at October 1, 2021. (b) Prepare the consolidated statement of profit or loss and other comprehensive

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