QUESTION2 Consolidation with NCI [30 MARKS]

Using the information provided below you are required to undertake the consolidation for the group.Hunter Ltd has one subsidiary, Bryan Ltd.

Bryan Ltd$000Share capitalOrdinary:Held by group1 200Held by other interests800--------$2 000=====Information about the companies for the year ended 30 June 2008 is as follows:HunterLtdBryanLtd$000$000Trading profit (loss)4601 000Income from investments340400Profit before tax8001 400Page|3Income tax expense100500Profit700900Dividend paid500500200400Retained earnings (1/7/07) 6 8003 600Retained earnings (30/6/08) $7 000$4 000===== ====HunterLtdBryanLtd$000$000Investments3 6083 000Other non-current asset (net)6 0003 000Current assets2 3922 000Total assets$12 000$8 000==========Share capital$1 000$2 000Asset revaluation reserve1 000-Retained earnings7 0004 000Total equity 9 0006 000Liabilities3 0002 000Total equity and liabilities$12 000$8 000==========Additional InformationHunter Ltd acquired a 60% interest in Bryan Ltd on 30 June 2000 for $3008000. Bryan Ltd's shareholders' equity at 30 June 2000 was:$000Share capital2 000Retained earnings2 0004 000====At the acquisition date, Bryan Ltd had no recorded goodwill. All the identifiable assets and liabilities of Bryan Ltd were recorded at fair value except the following:Carrying amountFair value$000$000Inventory500600Non-current assets (net)1 2001 500The non-current assets had a further expected life of 10 years, with benefits from use being received evenly over these years. By 30 June 2007, the entire inventory had been sold by Bryan Ltd.(i)Included in current assets of Hunter Ltd at 30 June 2008 is inventory that was purchased from Bryan Ltd for $900 000. (ii)Included in current assets of Hunter Ltd at 30 June 2007 was inventory that was purchased from Bryan Ltd for $600 000. Bryan Ltd sells its goods at cost plus 50% mark-up.Page|4(iii)Included in the non-current assets of Bryan Ltd at 30 June 2008 is an item of plant that was sold to Bryan Ltd by Hunter Ltd on 1 July 2007 for $1200000. At the date of sale, this asset had a carrying amount of Hunter Ltd of $1000000. It had an expected future useful life of 5 years, with benefits being received evenly over these years.The tax rate is 20%.Required:A.Show the pre-acquisition analysis as at 30 June 2000. (5marks)B.Prepare the relevant journal entries to effect the consolidation for Parent & NCI for year ending 30/6/2008. (10 marks)C.Prepare the consolidation worksheet. (10 marks)D.Prepare the Statement of Comprehensive Income and the Statement of Changes in Equity for the group for the year ended 30thJune 2008. (5marks)E.Prepare the Statement of Financial Position as at 30thJune 2008. (10 marks).