P Co purchased an interest of $90\%$ in the equity of S Co on $1$ July $204$ through cash payment

of $$4$ million when $S$ Co's book value of equity is as follows:

Share capital

Retained earnings as at $1$ July $204$

$3,000,000$

$500,000$

Book value of assets of S Co was close to fair value. However, S Co had an internally$-$generated

intellectual property that has a fair value of $$0\mathrm{.}5$ million.

Fair value of non$-$controlling interests as at date of acquisition was $$420,000.$

S$\text{'}$s intangible asset is deemed to have an infinite life. Impairment tests in $20$x$6$ showed an

impairment loss of $$100,000.$ FRS $36$ requires annual impairment tests of intangible assets with

infinite lives.

The following information relate to intercompany transactions and balances:

There are no other changes in equity of $S.$

Assume tax rate of $20\%$ throughout. Recognize tax on fair value adjustments.

Required:

$(1)$ Prepare the consolidation adjustments for year ended $31$ Dec $205.$

$(2)$ Complete the consolidation worksheets for the year ended $31$ Dec $20$x$5.$

$(3)$ Reconcile the non$-$controlling interests balance as at $31$Dec$205.$

$(4)$ Show consolidation adjustments for year ended $31$ Dec $20$x$6.$