Sydney Drome Ltd has started a company to undertake research and development of a new type of drome. For this research and development (R & D), it incurred the following expenditure in June 2020: Transaction Amount Payment status Obtaining a general understanding of wind-flow dynamics $750,000 Paid Understanding what local customers expect from a drome $450,000 Incurred Testing and refining a certain type of drome $1,350,000 Incurred Developing and testing a full prototype of the drome, to be called the invisible drome. $2,850,000 Incurred Marketing of the drome $1,800,000 Paid It is expected that there is a large market for the dromes, which will generate millions of dollars in revenue. On 1 July 2020, Sydney Drome Ltd acquired Solar Dromes Ltd for cash of $47,000,000. At that date, Solar Dromes net identifiable assets had a fair value of $43,500,000. The fair value of the net identifiable assets of Solar Dromes are determined as follows: Customer list $375,000 Machinery $10,875,000 Buildings $11,250,000 Land $22,500,000 $45,000,000 Less: Bank loan $1,500,000 Net assets $43,500,000 At the end of the reporting period of 30 June 2021, Solar Drome Ltd determines that the recoverable amount of the cash-generating unit, which is considered to be Solar Dromes Ltd, totals $45,000,000. The carrying amount of the net identifiable assets of Solar Dromes Ltd, which excludes goodwill, has not changed since acquisition and is $43,500,000.

REQUIRED: Prepare journal entries for each transaction from a to e above, following the requirements under AASB 138. (2.5 Marks)

Calculate the amount for impairment of goodwill as at 30 June 2021 following the requirements under AASB 3 and AASB 136. Please show all your calculations. (1 Mark)

Prepare journal entries to record an impairment of goodwill as at 30 June 2021. (0.5 Mark