Question (30mks)

Pineapple (P) bought 675,000 shares of Savana on 1 January 20X6 when the retained earnings of Savana stood at $375,000, given below are the statements of financial position as at 31 December 20X9:

	Pineapple	Savana
	$000	$000
Non-Current Assets
Land	950	450
Plant &Equipment	670	300
Investments	584
	2,204	750
CA
Inventory	650	175
Receivables	490	460
Bank	555	350
	1,695	985
Total Assets	3,899	1,735
Equity
Share Capital $ 1	1,800	900
RE	1,500	335
	3,300	1,235
NCL	670	350
CL	600	150
	1,270	500
Total Equity & Liabilities	3,350	1,735

Additional information

1. Pineapple paid $3m in cash for the investment in Savana and issued two shares for any five shares received from Savana. The market price of Pineapples shares at the time of acquisition was $1.65 per share. In addition, Pineapple promised to pay $ 2,800,000 in 5 years time. Savana has only recorded cash in its books. Cost of capital is 10%
2. Savana transferred goods to Pineapple at a mark-up of 25%. These goods had cost Savana $155,000. At the year-end, half of these goods were still in the inventory.
3. At the reporting date, Pineapple recorded a payable to Savana of $70,000. This did not agree to the corresponding amount in Savanas financial statements of $ 120,000. The difference was a cash in transit.
4. The Pineapple group uses the fair value method to value the NCI. The FV of the NCI at the time of acquisition was valued to be $180,000
5. Goodwill has been impaired by 250,000
6. At the time of acquisition, Land in the books of Savana had a fair value of $ 550,000. Equipment had a fair value of $370,000 above its carrying value and had a remaining life of 5years at the time of acquisition

Required prepare the consolidated statement of Financial Position of the Pineapple Group as at 31 December 20X9.