The following are the statements of financial position of Norwood Limited and Glendevon Limited,

as at the 31 December 2020. Norwood Limited acquired the shares in Glendevon Limited on

January 1, 2018 when the reserve balances were, general reserves: $3,000 and retained earnings $12 000.

Norwood Limited acquired 225,000 shares in Glendevon Limited by means of a share exchange and an

immediate cash payment of $180,000. The shareholders of Glendevon Limited were given 3 shares in

Norwood Limited for every 5 shares held in Glendevon Limited. The market price of a share in

Norwood Limited at this date was $5.10 and the market price of a share in Glendevon Limited was $3.40.

Only the immediate cash payment has been recorded in the books.

Statement of Financial Position as at 31 December 2020

Norwood Limited Glendevon Limited

Non Current Assets

Land 765,000.00 305000

Furniture and Fittings at net book value 246,000.00 123000

Machinery at net book value 134,000.00 90000

1,145,000.00 518,000.00

Investments

Subsidiary: Glendevon Ltd 180,000.00

Current Assets

Inventory 210,000.00 74,000.00

Trade Accounts Receivables 130,000.00 80,000.00

Prepayments 9,000.00 12,000.00

Bank & Cash 290,000.00 639,000 25,000.00 191,000.

1,964,000 709,000

Equity & Liabilities

$1 Ordinary Shares 800,000 300,000

Reserves

General reserves 70,000 27,000

Retained earnings 115,000 40,000

Non Current liability

9% Debentures 740,000 150,000

Current Liabilities

Trade Payables 145,000 164,000

Taxation 94,000 28,000

239,000 192,000

1,964,000 709,000

ADDITIONAL INFORMATION

1. At the date of the acquisition the fair market value of land owned by Glendevon Limited was $285,000, no adjustment were made.

2. At December 31, 2020 goodwill was impaired by $50,000.

3. The current account of Glendovon Ltd in the books of Norwood Limited had a debit balance of $50,000, whereas the corresponding current account in the books of Glendevon Ltd had a credit balance of $40,000. The difference represents a cash payment made by Glendevon Ltd not yet received by Norwood Ltd.

4. During the year NorwoodLtd sold goods to Glendevon Ltd for $63,000, after charging a mark-up of 50%.

At 31 December only 70% of the goods were sold.

5. During the year Glendevon Ltd transferred machinery to Norwood Ltd at a price of $120,000 (cost to Glendevon Ltd $70,000). Norwood Ltd depreciated the machinery at 10% of the cost to them.

6. Non-controlling interest should be valued at the market price per share at acquisition date of Glendevon

Prepare the Consolidated Statement of Financial Position for the Norwood Ltd Group as at December 31, 2020.