Question 2 (7 marks) XYZ Ltd acquires 100 per cent of Red-X Ltd on 1 July 2021. XYZ Ltd pays the shareholders of Red-X Ltd the following consideration: Cash Plant and equipment Land 79 100 fair value $282 500; carrying amount in the books of ABC Ltd $192 100 fair value $339 000; carrying amount in the books of ABC Ltd $226 000 There are also legal fees of $214 700 involved in acquiring Red-X Ltd. On 1 July 2021, Red-X Ltd's statement of financial position shows total assets of $339 000 and liabilities of $339 000. The fair value of the assets is $904 000. Required: I Has any goodwill been acquired; and, if so, how much? And discuss the potential for including associated legal fees into the cost of acquiring Red-X using appropriate accounting standards. ANSWER: Page 4 7 0