The following financial statements of Joel Ltd and its subsidiary Parko Ltd have been extracted from their financial records at 30 June 2012.

Joel Ltd Parko Ltd

$ thousands $ thousands

Reconciliation of opening and closing retained earnings

Sales revenue 671.40 540.00

Cost of goods sold (464.00) (238.00)

Gross profit 207.40 302.00

Dividends received from Parko Ltd 93.00

Management fee revenue 26.50

Gain on sale of plant 40.00 35.00

Expenses

Administrative expenses (30.80) (38.70)

Depreciation (29.50) (56.80)

Management fee expense (26.50)

Other expenses (101.10) (72.00)

Profit before tax 205.50 143.00

Tax expense 61.50 42.20

Profit for the year 144.00 100.80

Retained earnings - 30 June 2011 319.40 239.20

463.40 340.00

Dividends paid (137.40) (93.00)

Retained earnings - 30 June 2012 326.00 247.00

Joel Ltd Parko Ltd $ thousands $ thousands Statement of financial position Shareholders' equity Retained earnings 326 247 Share capital 350 200 Current liabilities Accounts payable 54.7 46.3 Tax payable 41.3 25 Non-current liabilities Loans 173.5 116

945.5 634.3

Current assets

Accounts receivable 59.4 62.3

Inventory 92 29

Non-current assets

Land and building 224 326

Plant - at cost 299.85 355.8

Accumulated depreciation -85.75 -138.8

Investment in Parko Ltd 356

945.5 634.3

Other Information

Joel Ltd acquired its 100 percent interest in Parko Ltd on 1 July 2007 that is five years earlier. At that date the capital and reserves of Parko Ltd were:

Share capital $200 000

Retained earnings $180 000

$380 000

At the date of acquisition all assets were considered to be fairly valued.

During the year Joel Ltd made total sales to Parko Ltd of $60 000, while Parko Ltd sold $50000 in inventory to Joel Ltd.

The opening inventory in Joel Ltd as at 1 July 2011 included inventory acquired from Parko Ltd for $40 000 that cost Parko Ltd $30 000 to produce.

The closing inventory in Joel Ltd includes inventory acquired from Parko Ltd at a cost of $33000. This cost Parko Ltd $28 000 to produce.

The closing inventory of Parko Ltd includes inventory acquired from Joel Ltd at a cost of $12000. This cost Joel Ltd $10 000 to produce.

On 1 July 2011Parko Ltd sold an item of plant to Joel Ltd for $116 000 when its carrying value in Parko Ltd's accounts was $81 000 (cost $135 000, accumulated depreciation $54000). This plant is assessed as having a remaining useful life of six years.

Parko Ltd paid $26 500 in management fees to Joel Ltd. The tax rate is 30 percent.

Required:

1. Prepare the acquisition analysis to determine any goodwill or gain from bargain purchase.

2. Prepare the journal entries necessary for consolidation purposes.

3. Prepare the consolidation worksheet.

4. Prepare the statement of comprehensive income for the year ended 30 June 2012.

5. Prepare the statement of financial position as at 30 June 2012.