QUESTION 4 Incredible Limited ("Incredible") is a listed company that trades in the information technology sector. Each of the three types of services mainly offered by the company is operated by a separate subsidiary, namely: sales of computer hardware; sales of computer software and computer supporting services. The company's internal reporting structure is also done based on the above-mentioned classification. The above-mentioned services are rendered to clients worldwide. Hardware. and software sales take place in Namibia. Supporting services are operated in China by means of a call center. Each subsidiary is managed separately as each business unit requires different technological and marketing strategies. EXTRACTS FROM THE CONSOLIDATED STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2022 Revenue/Sales Profit before interest income, interest expense, depreciation & tax Interest paid Interest received Depreciation Non-current assets Total assets Non-current assets purchased Total liabilities 1. Additional Information: 2. 3. 4. Computer Computer Support Consoli- hardware Software Services dation Journals N$ '000 a) N$ '000 10.000 9 300 Required 20 60 50 15.000 18 000 800 122 N$ '000 6 000 (6 800) 100 70 40 3 000 4 500 300 538 N$ '000 1 500 900 30 15 20 1.000 1 500 200 193 Page 16 of 24 15 MARKS (8 000) (480) (500) Consoli- dated N$ '000 9 500 2 920 150 145 110 Inter-company sales take place between the computer hard and software subsidiaries at normal market prices. The following inter-company transactions took place during the year ending 31 December 2022: Sales from hardware to software N$ 8 000 000 19 000 23 500 1.300 853 The N$ 480 000 consolidation journal regarding profit before tax consisted of the elimination of unrealized profit in stock of (debit N$ 500 000) and an unallocated FACULTY OF COMMERCE, MANAGEMENT AND LAW OLD CURRICULUM MODULES amount (credit N$ 20 000) regarding a litigation settlement received. The N$ 500 000 credit consolidation journal regards the unrealized profit in closing inventory. No single client represents more than 10% of the entity's revenue. Included in the profit figures of the computer hardware subsidiary above was an impairment regarding equipment to the amount of N$ 300 000. The amount is regarded as material. Please clearly indicate and comment on which segments in accordance with IFRS 8: Operating segments, should be included as part of the segment report. Please show all your calculations, including quantitative thresholds, clearly. (15)