Question 2. On 1 July 2017, Ormolu Ltd paid $330 960 for 75% of the share capital of Clock Ltd. At this date, the equity of Clock Ltd consisted of: Share capital (280 000 shares) $ 280 000 General reserve 112 000 Retained earnings 56 000 A comparison of the carrying amounts and fair values of Clock Ltd's assets at the acquisition date showed the following: Land Plant (cost $210 000) Inventory Accounts receivable Goodwill Carrying amount $257 600 140 000 91 000 56 000 5 600 Fair value $280 000 168 000 126 000 49 000 In relation to these assets, the following information is available: . The plant had a further 5-year life but was sold on 1 January 2019. . All the inventory was sold by 30 June 2018. . All the accounts receivable were collected by 30 June 2018. Any valuation reserves arising on consolidation are transferred on realisation of the asset to retained earnings. Ormolu Ltd uses the partial goodwill method. The following transactions occurred between 1 July 2017 and 30 June 2019: 2018 Jan. 19 Clock Ltd transferred $28 000 from general reserve to retained earnings. Feb. 24 Clock Ltd paid an $11 200 dividend, half being from profits earned prior to 1 July 2017. April 23 Clock Ltd sold inventory to Ormolu Ltd for $70 000 recording a before-tax profit of $14 000. Both companies use a perpetual inventory system. The tax rate is 30%. June 28 Clock Ltd declared a $21 000 dividend. Clock Ltd recorded a profit of $182 000. One-quarter of the inventory sold by Clock Ltd to Ormolu Ltd on 23 April 2018 is still on hand in Ormolu Ltd. Aug. 30 The $21 000 dividend declared by Clock Ltd was paid. Sept. 29 The remaining inventory in Ormolu Ltd sold to it by Clock Ltd was sold outside the group. 2019 Jan. 19 Clock Ltd paid a $22 400 dividend. June 30 Clock Ltd recorded a profit of $210 000. Required Prepare the consolidation worksheet JOURNAL ENTRIES for the preparation of consolidated financial statements by Ormolu Ltd at 30 June 2019. Note a consolidation worksheet is NOT required. Your answer should include an acquisition analysis with a calculation of goodwill/gain on bargain purchase, business combination valuation entries, pre-acquisition entries, the NCI share of equity at acquisition date, from acquisition date to the beginning of the year of consolidation, and for the year of consolidation, dividend adjustments, intragroup sales, and asset disposals. Question 2. On 1 July 2017, Ormolu Ltd paid $330 960 for 75% of the share capital of Clock Ltd. At this date, the equity of Clock Ltd consisted of: Share capital (280 000 shares) $ 280 000 General reserve 112 000 Retained earnings 56 000 A comparison of the carrying amounts and fair values of Clock Ltd's assets at the acquisition date showed the following: Land Plant (cost $210 000) Inventory Accounts receivable Goodwill Carrying amount $257 600 140 000 91 000 56 000 5 600 Fair value $280 000 168 000 126 000 49 000 In relation to these assets, the following information is available: . The plant had a further 5-year life but was sold on 1 January 2019. . All the inventory was sold by 30 June 2018. . All the accounts receivable were collected by 30 June 2018. Any valuation reserves arising on consolidation are transferred on realisation of the asset to retained earnings. Ormolu Ltd uses the partial goodwill method. The following transactions occurred between 1 July 2017 and 30 June 2019: 2018 Jan. 19 Clock Ltd transferred $28 000 from general reserve to retained earnings. Feb. 24 Clock Ltd paid an $11 200 dividend, half being from profits earned prior to 1 July 2017. April 23 Clock Ltd sold inventory to Ormolu Ltd for $70 000 recording a before-tax profit of $14 000. Both companies use a perpetual inventory system. The tax rate is 30%. June 28 Clock Ltd declared a $21 000 dividend. Clock Ltd recorded a profit of $182 000. One-quarter of the inventory sold by Clock Ltd to Ormolu Ltd on 23 April 2018 is still on hand in Ormolu Ltd. Aug. 30 The $21 000 dividend declared by Clock Ltd was paid. Sept. 29 The remaining inventory in Ormolu Ltd sold to it by Clock Ltd was sold outside the group. 2019 Jan. 19 Clock Ltd paid a $22 400 dividend. June 30 Clock Ltd recorded a profit of $210 000. Required Prepare the consolidation worksheet JOURNAL ENTRIES for the preparation of consolidated financial statements by Ormolu Ltd at 30 June 2019. Note a consolidation worksheet is NOT required. Your answer should include an acquisition analysis with a calculation of goodwill/gain on bargain purchase, business combination valuation entries, pre-acquisition entries, the NCI share of equity at acquisition date, from acquisition date to the beginning of the year of consolidation, and for the year of consolidation, dividend adjustments, intragroup sales, and asset disposals