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The following financial statements of Greg Ltd and its subsidiary Wayne Ltd have been extracted from their financial records at 30 June 2022. Additional information:
The following financial statements of Greg Ltd and its subsidiary Wayne Ltd have been extracted from their financial records at 30 June 2022. Additional information: Greg Ltd acquired its 100 per cent interest in Wayne Ltd on 1 July 2017, that is, five years earlier. Share capital $200000 Retain earnings $180000 Total $380000 At the date of acquisition all assets were considered to be fairly valued. During the year Greg Ltd made total sales to Wayne Ltd of $60 000, while Wayne Ltd sold $50 000 in inventory to Greg Ltd. The opening inventory in Greg Ltd as at 1 July 2021 included inventory acquired from Wayne Ltd for $40 000 that cost Wayne Ltd $30 000 to produce. The closing inventory in Greg Ltd includes inventory acquired from Wayne Ltd at a cost of $33 000. This cost Wayne Ltd $28 000 to produce. The closing inventory of Wayne Ltd includes inventory acquired from Greg Ltd at a cost of $12 000. This cost Greg Ltd $10 000 to produce. On 1 July 2021 Wayne Ltd sold an item of plant to Greg Ltd for $116 000 when its carrying value in Wayne Ltds accounts was $81 000 (cost $135 000, accumulated depreciation $54 000). This plant is assessed as having a remaining useful life of six years. The Group has a policy of measuring its property, plant and equipment using the cost model. Wayne Ltd paid $26 500 in management fees to Greg Ltd. The tax rate is 30 per cent. Required: (A) Prepare acquisition analysis showing goodwill or gain on bargain purchase. (B) Prepare acquisition journal entries consolidation journal entries. (C) Prepare consolidation worksheet (D) Prepare statement of profit and loss and other comprehensive income of Greg Ltd and its subsidiaries for the year ended 30 June 2022. (E) Prepare Consolidated statement of financial position of Greg Ltd and its subsidiaries as at 30 June 2022. (F) Prepare Consolidated statement of changes in equity for the year ended 30 June 2022
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