QUESTION 3(40 Marks) Winter Ltd owns all the shares of Keira Ltd. The shares were acquired on 1 July 2010 by Winter Ltd at a cost of $60000. At acquisition date, the capital of Keira Ltd consisted of 44000 ordinary shares each fully paid at S1. There were retained earnings of $4000. All the identifiable assets and liabilities of Keira Ltd were recorded at amounts equal to fair value, except for: Fair Value Inventory Land Carrying Amount $12000 60000 70000 The land was sold on 1 June 2011 for $94000. The machinery had a further 5-year life. The inventory was all sold by 31 December 2010. Keira Ltd has not recorded any goodwill at 1 July 2010. Good will has not been impaired. QUESTION 3(40 Marks) Winter Ltd owns all the shares of Keira Ltd. The shares were acquired on 1 July 2010 by Winter Ltd at a cost of $60000. At acquisition date, the capital of Keira Ltd consisted of 44000 ordinary shares each fully paid at S1. There were retained earnings of $4000. All the identifiable assets and liabilities of Keira Ltd were recorded at amounts equal to fair value, except for: Fair Value Inventory Land Carrying Amount $12000 60000 70000 The land was sold on 1 June 2011 for $94000. The machinery had a further 5-year life. The inventory was all sold by 31 December 2010. Keira Ltd has not recorded any goodwill at 1 July 2010. Good will has not been impaired