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QUESTION 1 - Jan 2020 The following are the statement of comprehensive income for Mocha Berhad, Arabica Sdn Bhd, and Latte Sdn Bhd for

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QUESTION 1 - Jan 2020 The following are the statement of comprehensive income for Mocha Berhad, Arabica Sdn Bhd, and Latte Sdn Bhd for year ending 31.12.2019: Draft Statement of Comprehensive Income for period ending 31.12.2019 Mocha Arabica Latte (RM'000) (RM'000) (RM'000) 130,000 24,600 16,400 Turnover Cost of Sales Gross Margin Expenses (72,200) (14,200) (9,400) 57,800 10,400 7,000 (38,400) (7,500) (4,020) Operating Profit 19,400 2,900 2,980 Gain on sale of plant 1,200 Nil Nil Dividends from subsidiary 1,000 400 Nil Profit before tax 21,600 3,300 2,980 Taxation (5,400) (800) (700) Profit after taxation 16,200 2,500 2,280 Retained Earnings @ 1.1.2019 46,200 17,600 10.900 Other information: Ordinary dividends paid in 2019 4,000 2,000 800 Preference dividends paid in 2019 Nil Nil 100 Ordinary share capital 130,000 19,000 11,600 Additional Information: 1. Mocha acquired 80% of the ordinary shares of Arabica on 1.1.2019. Goodwill on consolidation was RM4.4million. Goodwill was impaired by 20% as at 31.12.2019. Non- controlling interest is measured in proportion to the fair value of the net assets of the subsidiary on the acquisition date. 2. On 1st July 2019, Arabica acquired 75% of issued ordinary shares and 20% of preference shares belonging to Latte for RM4.6million. Goodwill on consolidation was RM500,000, RM100,000 of the goodwill was impaired as at 31.12.2019. 3. During the year, Arabica sold inventory at invoice value of RM400,000 to Mocha and sot plus 25%. Mocha has not sold any of these inventories yet. 4. In year 2019, Mocha sold a plant of carrying amount of RM700,000 for RM900,000. The remaining useful life is 5 years. Full year's depreciation is given in the year of acquisition and non in the year of disposal. Depreciation policy is on a straight line basis. Required: (a) Prepare the consolidated statement of comprehensive income for the period ending 31.12.2019. (b) Determine the group's retained earnings as at 31.12.2019.

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