Question/Required:

1) Consolidated Journal Entries - Consolidation Adjustments at 30/06/2021

2) Consolidated Worksheet - (worksheet given below)

3) Consolidate Income Statement

4) Consolidated Balance sheet

On 1/07/2018 100% $3,028,000 Big Ltd acquired: of the issued shares of Small Ltd for: At the date of acquisition, the Owners' Equity of Small Ltd consisted of: Share capital Plant replacement reserve Retained earnings $1,362,600 $340,700 $255,420 $1,958,720 As at 30/06/2021 The accounts of the two companies appear as follows: Sales less Cost of Goods Sold Depreciation expense Interest expense Other expenses Big Ltd $ 4,845,000 2,907,000 242,200 193,800 512,000 Small Ltd $ 2,441,400 1,586,900 122,000 86,260 65,040 Other Income plus Interest revenue Dividend revenue 129,300 264,900 OO less Income tax expense Net Profit after Tax Retained earnings (01/07/2020) Available for appropriation 415,200 969,000 1,453,400 2,422,400 174,300 406,900 425,700 832,600 Interim dividend paid Final dividend declared Retained earnings (30/06/2021) 227,100 378,500 1,816,800 113,500 151,400 567,700 Share Capital Plant replacement reserve Total Owner's Equity 3,936,400 302,800 6,056,000 1,362,600 340,700 2,271,000 Loan payable (due 30/06/2023) Dividend payable Deferred Tax Liability Other liabilities Total Liabilities 378,500 454,200 681,300 1,514,000 454,000 151,400 37,800 113,800 757,000 Total Liabilities & Owner's Equity 7,570,000 3,028,000 Assets Dividend receivable Inventory Property, Plant & Equipment Accumulated depreciation Land Investment in Small Ltd Loan receivable Other assets Total Assets 151,400 1,059,800 2,043,900 -817,600 1,286,900 3,028,000 454,000 363,600 7,570,000 o 181,600 1,211,200 -242 300 1,211,200 0 0 666,300 3,028,000 Additional information: a) At date of acquisition, all identifiable net assets of Small Ltd were recorded at fair value, with the exception of a block of land in the books of Small Ltd. The block of land had a carrying value of: and a fair value of: $1,211,200 $1,690,000 b) The directors apply the impairment test for goodwill annually. As at 30/06/2021 The cumulative goodwill impairment write-downs for prior years totalled: $587,000 On 1/07/2019 c) An equipment owned by Small Ltd was sold to Big Ltd. Cost of the equipment was: Accumulated depreciation of the equipment was: The asset was sold for: Big Ltd estimated this item had a remaining useful life of: and residual value of: $541,000 $193,000 $484,000 5 $0 years $317,000 d) The opening inventory of Big Ltd includes unrealised profit of: on inventory transferred from Small Ltd during the prior financial year. 30/05/2021 All of this inventory was sold by Big Ltd to parties external to the Group. By e) During the current year, Big Ltd purchased inventory from Sm Ltd for: This inventory had previously cost Small Ltd: Percentage of this inventory sold to outsiders by Big Ltd during the year $1,377,000 $550,000 509 f) Small Ltd borrowed a loan from Big Ltd amounting to: 30/06/2021 Small Ltd paid the annual interest for the intra group loan at a rate of: $454,000 19% On 8) During the current year, Big Ltd paid Arina Ltd, an external party for management fees expense amouning to: $2,000 h) The following are dividends paid and declared by Small Ltd to Big Ltd: Interim dividend paid Final dividend declared 113,500 151,400 il The tax rate is: 30% CP in Costa Good Solid SAMS,000 $2,441,400 $2.907000 51586.900 Depreciation experts Internet explore Other M2,200 $199.00 $$12.000 $122.00 20 home plan Interve Dividende $129,00 $ 20 Income tax experte SALS.200 $17,300 Net Pro Retained eaming (01/07/2020 3909.000 306.200 $1,451,400 - Available for appropriation $2.422.400 $32.000 Interim dividend Final dividend declared Retained aming (30/06/2021) $70 S1816.800 $113300 SE51400 2967700 Share Capital Plant Replacement Reve BCVR Revaluation Reserve Total Owner Equity $1,936,200 $1,362,600 $302.300 SMO,00 30 30 $5,050,000 Loan payable due 30/05/2023 Dividende Deemed TaxLby Othere Totale 30 SASA 000 $37.500 $151.400 SASA 200 $37.100 1300 SL300 $1.514.000 ST.7000 Totallien & Ownegaby 37, 370,000 $3.013,000 Dividend receivables Inventory Property Plant Accumulated depreciation SE5400 30 51.053.00 $18.600 520900 SLZL 200 -5817800 SM 51.286.900 51.211.200 S10 30 SASA 000 30 Inventino Lanceivable Goodwill Accumulated impairment Lom Deaned Tax A S600 Tons At $363.000 57 370,000 Big Ltd and its subsidiary Consolidated statement of comprehensive income for the year ended 30 June 2021 Economic Entity Sales revenue $0 Cost of goods sold $0 Gross profit $0 less Depreciation expenses $0 Interest expenses $0 Other expenses $0 Total expenses $0 Plus Other income Interest revenue $0 Dividend revenue $0 Total other income $0 Net profit before tax $0 Income tax expense $0 Net profit after tax (NPAT) $0 NPAT Attributable to Parent (100%) $0 NPAT Attributable to NCI (0%) SO 10096 0% Big Ltd and its subsidiary Consolidated statement of financial position as at 30 June 2021 Economic Entity Assets Current Assets Dividend receivables $0 Inventory $0 Non current Assets Property Plant & Equipment Accumulated depreciation Land Investment in Small Ltd Loan receivable Goodwill Accumulated impairment losses Deferred tax asset Other assets Total assets $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 Liabilities Current Liabilities Dividend payable $0 Non-current liabilities Loan payable (due 30/06/2023) Deferred tax liability Other liabilities Total Liabilities $0 $0 $0 $0 Retained earnings (30/06/2021) Share Capital Plant Replacement Reserve BCVR/Revaluation reserve Total Shareholder's Equity $0 $0 $0 SO $0 50 On 1/07/2018 100% $3,028,000 Big Ltd acquired: of the issued shares of Small Ltd for: At the date of acquisition, the Owners' Equity of Small Ltd consisted of: Share capital Plant replacement reserve Retained earnings $1,362,600 $340,700 $255,420 $1,958,720 As at 30/06/2021 The accounts of the two companies appear as follows: Sales less Cost of Goods Sold Depreciation expense Interest expense Other expenses Big Ltd $ 4,845,000 2,907,000 242,200 193,800 512,000 Small Ltd $ 2,441,400 1,586,900 122,000 86,260 65,040 Other Income plus Interest revenue Dividend revenue 129,300 264,900 OO less Income tax expense Net Profit after Tax Retained earnings (01/07/2020) Available for appropriation 415,200 969,000 1,453,400 2,422,400 174,300 406,900 425,700 832,600 Interim dividend paid Final dividend declared Retained earnings (30/06/2021) 227,100 378,500 1,816,800 113,500 151,400 567,700 Share Capital Plant replacement reserve Total Owner's Equity 3,936,400 302,800 6,056,000 1,362,600 340,700 2,271,000 Loan payable (due 30/06/2023) Dividend payable Deferred Tax Liability Other liabilities Total Liabilities 378,500 454,200 681,300 1,514,000 454,000 151,400 37,800 113,800 757,000 Total Liabilities & Owner's Equity 7,570,000 3,028,000 Assets Dividend receivable Inventory Property, Plant & Equipment Accumulated depreciation Land Investment in Small Ltd Loan receivable Other assets Total Assets 151,400 1,059,800 2,043,900 -817,600 1,286,900 3,028,000 454,000 363,600 7,570,000 o 181,600 1,211,200 -242 300 1,211,200 0 0 666,300 3,028,000 Additional information: a) At date of acquisition, all identifiable net assets of Small Ltd were recorded at fair value, with the exception of a block of land in the books of Small Ltd. The block of land had a carrying value of: and a fair value of: $1,211,200 $1,690,000 b) The directors apply the impairment test for goodwill annually. As at 30/06/2021 The cumulative goodwill impairment write-downs for prior years totalled: $587,000 On 1/07/2019 c) An equipment owned by Small Ltd was sold to Big Ltd. Cost of the equipment was: Accumulated depreciation of the equipment was: The asset was sold for: Big Ltd estimated this item had a remaining useful life of: and residual value of: $541,000 $193,000 $484,000 5 $0 years $317,000 d) The opening inventory of Big Ltd includes unrealised profit of: on inventory transferred from Small Ltd during the prior financial year. 30/05/2021 All of this inventory was sold by Big Ltd to parties external to the Group. By e) During the current year, Big Ltd purchased inventory from Sm Ltd for: This inventory had previously cost Small Ltd: Percentage of this inventory sold to outsiders by Big Ltd during the year $1,377,000 $550,000 509 f) Small Ltd borrowed a loan from Big Ltd amounting to: 30/06/2021 Small Ltd paid the annual interest for the intra group loan at a rate of: $454,000 19% On 8) During the current year, Big Ltd paid Arina Ltd, an external party for management fees expense amouning to: $2,000 h) The following are dividends paid and declared by Small Ltd to Big Ltd: Interim dividend paid Final dividend declared 113,500 151,400 il The tax rate is: 30% CP in Costa Good Solid SAMS,000 $2,441,400 $2.907000 51586.900 Depreciation experts Internet explore Other M2,200 $199.00 $$12.000 $122.00 20 home plan Interve Dividende $129,00 $ 20 Income tax experte SALS.200 $17,300 Net Pro Retained eaming (01/07/2020 3909.000 306.200 $1,451,400 - Available for appropriation $2.422.400 $32.000 Interim dividend Final dividend declared Retained aming (30/06/2021) $70 S1816.800 $113300 SE51400 2967700 Share Capital Plant Replacement Reve BCVR Revaluation Reserve Total Owner Equity $1,936,200 $1,362,600 $302.300 SMO,00 30 30 $5,050,000 Loan payable due 30/05/2023 Dividende Deemed TaxLby Othere Totale 30 SASA 000 $37.500 $151.400 SASA 200 $37.100 1300 SL300 $1.514.000 ST.7000 Totallien & Ownegaby 37, 370,000 $3.013,000 Dividend receivables Inventory Property Plant Accumulated depreciation SE5400 30 51.053.00 $18.600 520900 SLZL 200 -5817800 SM 51.286.900 51.211.200 S10 30 SASA 000 30 Inventino Lanceivable Goodwill Accumulated impairment Lom Deaned Tax A S600 Tons At $363.000 57 370,000 Big Ltd and its subsidiary Consolidated statement of comprehensive income for the year ended 30 June 2021 Economic Entity Sales revenue $0 Cost of goods sold $0 Gross profit $0 less Depreciation expenses $0 Interest expenses $0 Other expenses $0 Total expenses $0 Plus Other income Interest revenue $0 Dividend revenue $0 Total other income $0 Net profit before tax $0 Income tax expense $0 Net profit after tax (NPAT) $0 NPAT Attributable to Parent (100%) $0 NPAT Attributable to NCI (0%) SO 10096 0% Big Ltd and its subsidiary Consolidated statement of financial position as at 30 June 2021 Economic Entity Assets Current Assets Dividend receivables $0 Inventory $0 Non current Assets Property Plant & Equipment Accumulated depreciation Land Investment in Small Ltd Loan receivable Goodwill Accumulated impairment losses Deferred tax asset Other assets Total assets $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 Liabilities Current Liabilities Dividend payable $0 Non-current liabilities Loan payable (due 30/06/2023) Deferred tax liability Other liabilities Total Liabilities $0 $0 $0 $0 Retained earnings (30/06/2021) Share Capital Plant Replacement Reserve BCVR/Revaluation reserve Total Shareholder's Equity $0 $0 $0 SO $0 50