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On 1 January 2013, Menara Bhd acquired 60% interest in Damai Bhd for a cash consideration of RM28 million. Given below are the summarized accounts of the two companies for the year ended 31 December 2013 Damai Bhd RM'000 22,000 R Statement of Comprehensive Income and Retained Earnings Menara Bhd RM'000 Jualan/ Sales 34,000 Kos Jualan / Cost of sales: Inventori Awal / Beginning Inventory (8,000) Belian / Purchases (18,000) Inventori akhir / Ending Inventory 10,000 (16,000) Untung kasar / Gross profit 18,000 Perbelanjaan / Expenses (2,000) Untung sebelum cukai / Profit before taxation 16,000 Cukai / Taxation (4,800) Untung selepas cukai/ Profit after taxation 11,200 Perolehan tertahan b/b / Retained earnings of 10,800 Perolehan tertahan b/d / Retained earnings all 22,000 (5,000) (9,000) 6,000 (8,000) 14,000 (1,000) 13,000 (3,900) 9,100 8,900 18,000 Penyata Kedudukan Kewangan / Statement of Financial Position Menara Bhd Damai Bhd RM"000 RM'000 Saham biasa pada RM1 setiap satu 42.000 8,000 Ordinary shares at RM1 each Perolehan tertahan / Retained Eornings 22,000 18,000 Jumlah liabiliti / Total Liabilities 14,000 8,000 78,000 34,000 31,000 20,000 Hartanah, Loji dan Peralatan Property, Plant and Equipment Pelaburan di dalam / Investment in Damal Bhd Inventori / Inventory Lain-lain aset semasa / Other current assets 28,000 10,000 9,000 78,000 6,000 8,000 34,000 At the acquisition date, the retained profit and net assets were recorded in the book of Damai Bhd at RM6,000,000 and RM14,000,000 respectively. Tan & Tun Realty Co. estimated that the market value of the land, which was used by Damai Bhd to build its factory was RM3,000,000 on 1 January 2013. The land was purchased 10 years ago at RM500,000 and were classified under Property. Plant and Equipment in the book of Damai Bhd. Damai Bhd did not make any adjustment in its book at the acquisition date. Menara Bhd incurred a cost of RM150,000 for professional fees paid to evaluators and lawyers in relation to the acquisition. Dalam lan Bac L. 4 Di During the year ended 31 December 2013, Damai Bhd sold merchandise to Menara Bhd for invoice totaling RM3,000,000. Of these sales, RM80,000 remained in the ending inventory of Menara Bhd. The corresponding intragroup sales and ending inventory for the 2012 financial year were RM2,000,000 and RM500,000 respectively. The profit margin to Damai Bhd was 25% on selling price. The group policy is to measure non-controlling interest at fall value of the net identifiable assets of subsidiary. f) Cukai pendapatan ialah pada kadar 30%. Income tax rate is 30%. Prepare a consolidation worksheet to derive the group account for the 2013 financial year. Show all your workings. (20 markah/marks) On 1 January 2013, Menara Bhd acquired 60% interest in Damai Bhd for a cash consideration of RM28 million. Given below are the summarized accounts of the two companies for the year ended 31 December 2013 Damai Bhd RM'000 22,000 R Statement of Comprehensive Income and Retained Earnings Menara Bhd RM'000 Jualan/ Sales 34,000 Kos Jualan / Cost of sales: Inventori Awal / Beginning Inventory (8,000) Belian / Purchases (18,000) Inventori akhir / Ending Inventory 10,000 (16,000) Untung kasar / Gross profit 18,000 Perbelanjaan / Expenses (2,000) Untung sebelum cukai / Profit before taxation 16,000 Cukai / Taxation (4,800) Untung selepas cukai/ Profit after taxation 11,200 Perolehan tertahan b/b / Retained earnings of 10,800 Perolehan tertahan b/d / Retained earnings all 22,000 (5,000) (9,000) 6,000 (8,000) 14,000 (1,000) 13,000 (3,900) 9,100 8,900 18,000 Penyata Kedudukan Kewangan / Statement of Financial Position Menara Bhd Damai Bhd RM"000 RM'000 Saham biasa pada RM1 setiap satu 42.000 8,000 Ordinary shares at RM1 each Perolehan tertahan / Retained Eornings 22,000 18,000 Jumlah liabiliti / Total Liabilities 14,000 8,000 78,000 34,000 31,000 20,000 Hartanah, Loji dan Peralatan Property, Plant and Equipment Pelaburan di dalam / Investment in Damal Bhd Inventori / Inventory Lain-lain aset semasa / Other current assets 28,000 10,000 9,000 78,000 6,000 8,000 34,000 At the acquisition date, the retained profit and net assets were recorded in the book of Damai Bhd at RM6,000,000 and RM14,000,000 respectively. Tan & Tun Realty Co. estimated that the market value of the land, which was used by Damai Bhd to build its factory was RM3,000,000 on 1 January 2013. The land was purchased 10 years ago at RM500,000 and were classified under Property. Plant and Equipment in the book of Damai Bhd. Damai Bhd did not make any adjustment in its book at the acquisition date. Menara Bhd incurred a cost of RM150,000 for professional fees paid to evaluators and lawyers in relation to the acquisition. Dalam lan Bac L. 4 Di During the year ended 31 December 2013, Damai Bhd sold merchandise to Menara Bhd for invoice totaling RM3,000,000. Of these sales, RM80,000 remained in the ending inventory of Menara Bhd. The corresponding intragroup sales and ending inventory for the 2012 financial year were RM2,000,000 and RM500,000 respectively. The profit margin to Damai Bhd was 25% on selling price. The group policy is to measure non-controlling interest at fall value of the net identifiable assets of subsidiary. f) Cukai pendapatan ialah pada kadar 30%. Income tax rate is 30%. Prepare a consolidation worksheet to derive the group account for the 2013 financial year. Show all your workings. (20 markah/marks)