QUESTION 1 (30 Marks) Red Sky Share capital: Ordinary shares of RM1 each 10% Preferences shares of RM1 each Share Premium Retained Profit Current liabilities: Trade payable 800,000 100,000 10,000 160,000 450,000 100,000 5,000 50,000 50,000 1,120,000 30,000 635,000 RM 300,000 RM 355,000 185,000 200,000 Non-current Assets: Land Plant and machinery at cost Investments in Sky - Ordinary share - 10% Preference share 510,000 20,000 Current Assets: Inventories Trade receivable Cash at bank and in hand 40,000 25,000 25,000 1,120,000 20,000 40,000 35,000 635,000 Given above are the statements of financial position of Red Berhad and Sky Berhad as at 31*July 2021: Additional information: 1. Red acquired 405,000 ordinary shares and 20,000 10% preferences share of Sky on 1*August 2020 when the retained profit of S was RM40,000 and share premium of Sky was RM1,000. 2. Trade receivables of Sky include RM3,000 due from Red where RM1,000 of which relates to good in transit from Red. 3. On 1 December 2020, the fair value land of Red increase by RM30,000. Red did not record the changes yet. 4. The director of Red and Sky have declared the dividend for both ordinary shares and preference share as follow but not yet record it: Red : Ordinary share --RM32,000 : Preference share - RM10,000 : Ordinary share - RM13,500 : Preference share - RM10,000 Sky 5. Goodwill on consolidation is impaired by 20% during the year. 6. Trade receivables of Red include RM5,000 due from Sky where RM1,000 of which relates to cash in transit from Sky. Required: Prepare Consolidated Statement of Financial Position of Red and Sky as at 316 July 2021. (Show all your workings) (30 marks)