Q3.

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Delta prepares financial statements to 31 March each year. Delta has a number of subsidiaries which business sectors. The following exhibits, available on the left-hand side of the screen, provide information relevant to th 1. Cattle and sheep - details of the cattle and sheep herds owned by subsidiary Omega which opera 2. Purchase of shares - details of the purchase of shares in a trading portfolio by subsidiary Kappa. 3. Acquisition of subsidiary - information on the acquisition of subsidiary Zeta including the fair value This information should be used to answer the question requirements within your chosen response Omega has a herd of 300 cattle which are all six months old on 31 March 20x5 and a herd of 200 sheep which are all one year old at 31 March 20X5. The herd of cattle will be sold when the cattle are two years old. The herd of sheep is expected to be sold within the next 12 months. There are two markets available to Omega in which they could sell the cattle and the sheep, Market 1 and Market 2. Market 1 is the principal market in which cattle could be sold but Omega sells its sheep in both Market 1 and Market 2 in roughly equal proportions. Therefore, neither Market 1 nor Market 2 can be identified as the principal market in which Omega could sell sheep. Relevant market prices and relevant costs of sale at 31 March 20x5 are as follows: Market 1 Market 2 Cattle Sheep Cattle Sheep $ $ $ $ Gross selling price per animal 80 61 85 63 Transport costs per animal 4 3 5 4 Selling costs per animal 2 2 3 4 Kappa has a portfolio of equity shares which is regarded as a trading portfolio. On 1 January 20x5 Kappa purchased 20,000 shares in a listed entity and added these shares to the trading portfolio. Kappa purchased the shares for $5-25 per share and paid a commission to the broker of 20 cents per share. Due to favourable market conditions Kappa retained these shares and they were still part of the trading portfolio at 31 March 20X5. These shares are listed on a single stock exchange. Relevant market prices (per share) are as follows: Date Bid price Offer price $ $ 1 January 20X5 5-00 5-25 31 March 20X5 5-80 6-10 Using the information in exhibits 1 - 3, explain and compute the amounts that would be recognised by Delta in its consolidated financial statements for the year ended 31 March 20X5 and state where in these financial statements they should be presented. Marks will be awarded for BOTH calculations AND explanations