QUESTION 1

Below are the Statements of Profit or Loss and Statements of Changes in Equity of Jupiter Bhd and Mars Bhd for the year ended 31 December 2018.

Statement of Profit or Loss for the year ended 31 December 2018

	Jupiter Bhd	Mars Bhd
	RM	RM
Sales	4,750,000	3,790,000
Cost of sales	(1,139,000)	(277,300)
Gross profit	3,611,000	3,512,700
Profit on sale of equipment	-	8,000
Other Income	116,320	3,000
Selling expenses	(150,000)	(125,000)
Administration expenses	(100,000)	(30,000)
Finance cost	(30,000)	(20,000)
Operating profit before tax	3,447,320	3,348,700
Taxation	(295,000)	(115,550)
Profit the year	3,152,320	3,233,150

Statement of Changes in Equity for the year ended 31 December 2018 (extract)

	Jupiter Bhd	Mars Bhd
	RM	RM
Retained profit brought forward	127,500	40,000
Profit for the year	3,152,320	3,233,150
Ordinary dividends	(232,500)	(137,600)
Preference dividends	(30,000)	(24,000)
Transfer to general reserves	(50,000)	-
Retained profit carried forward	2,967,320	3,111,550

Additional Information:

1. The paid-up capital of both companies are as follows:

Company Name	Ordinary shares	6% Cumulative Preference shares
	RM	RM
Jupiter Bhd	2,000,000	500,000
Mars Bhd	800,000	400,000

2. Jupiter Bhd acquired 70% of the ordinary shares and 50% of the Preference Shares of Mars Bhd on 2 January 2018 for RM450,000 and RM200,000 respectively.

3. Sales of Jupiter Bhd include sales to Mars Bhd amounted to RM140,000. Jupiter Bhd sold the goods to Mars Bhd at cost plus of 25%. At the end of the year, RM60,000 of these goods remained unsold.

4. As at 31 December 2018, goodwill on consolidation was impaired by 20%.

5. During the year, Mars Bhd sold equipment to Jupiter Bhd at RM8,000 above it carrying value. Depreciation has been provided at 20% on carrying value on yearly basis.

6. Both companies have recorded the ordinary and preference dividends declared before the year ended 31 December 2018. However, Jupiter Bhd has only recorded ordinary dividend receivable from Mars Bhd.

Required:

1. Prepare the Consolidated Statement of Profit or Loss of Jupiter Bhd for the year ended 31 December 2018 (show all workings).

2. Prepare the extract of the Statement of Changes in Equity of Jupiter Bhd for the year ended 31 December 2018 showing the retained profit and non-controlling interest column only.