The summarized statements of financial position of P Ltd. and S Ltd. as at 31st December 2018 were as follows: P Ltd. S Ltd. 58,200 80,000 84,000 18,000 62,700 Assets Non-current Assets Property, Plant & Equipment Investments Current Assets Inventories Trade and other Receivables Investments Cash and Cash Receivables Current Account with Close Ltd. Total Assets Equity and Liabilities Equity Ordinary share capital (@ $1 par) Share premium account Revaluation surplus Retained Earnings Current Liabilities Trade and other payables Current account with Steele Ltd. Total Equity and Liabilities 12,000 21,100 2,500 3,000 3,200 100,000 10,000 254,700 60,000 120,000 18,000 23,000 56,000 16,000 13,000 11,000 35,000 2,700 254,700 100,000 The following information is relevant: a. On 1st January 2016 P Ltd. acquired 48,000 share in S Ltd. for the following consideration: i. Cash payment of $ 35,000 at the acquisition date. ii. Exchange of 5,000 shares of P Ltd. trading at $5 in the stock market at the acquisition date. iii. Payment of $16,152 on 30th June 2017. iv. Exchange of 2,000 shares of P Ltd. trading at $6 on 30th June 2017. b. The inventories of P Ltd. include $4,000 of goods from s Ltd. invoiced to P Ltd. at cost plus 25% C. A cheque for $500 from P Ltd. to S Ltd. sent before 31st December 2018, was not received by the latter company until January 2019. d. An impairment review at 31st December 2018 revealed that an impairment loss of $500 in respect of goodwill on the acquisition of S Ltd. needs to be recognized. By 1 January 2018 this goodwill had already suffered impairments totaling $1,700. e. The non-controlling interest and goodwill arising on the acquisition of S Ltd. were both calculated using the proportionate method. Requirements: Determine the total amount of consideration paid by P Ltd to acquire S Ltd and prepare the consolidate statement of financial position of P Ltd. and its subsidiary S Ltd. as at 31 December 2018. (Show necessary workings) [15] The summarized statements of financial position of P Ltd. and S Ltd. as at 31st December 2018 were as follows: P Ltd. S Ltd. 58,200 80,000 84,000 18,000 62,700 Assets Non-current Assets Property, Plant & Equipment Investments Current Assets Inventories Trade and other Receivables Investments Cash and Cash Receivables Current Account with Close Ltd. Total Assets Equity and Liabilities Equity Ordinary share capital (@ $1 par) Share premium account Revaluation surplus Retained Earnings Current Liabilities Trade and other payables Current account with Steele Ltd. Total Equity and Liabilities 12,000 21,100 2,500 3,000 3,200 100,000 10,000 254,700 60,000 120,000 18,000 23,000 56,000 16,000 13,000 11,000 35,000 2,700 254,700 100,000 The following information is relevant: a. On 1st January 2016 P Ltd. acquired 48,000 share in S Ltd. for the following consideration: i. Cash payment of $ 35,000 at the acquisition date. ii. Exchange of 5,000 shares of P Ltd. trading at $5 in the stock market at the acquisition date. iii. Payment of $16,152 on 30th June 2017. iv. Exchange of 2,000 shares of P Ltd. trading at $6 on 30th June 2017. b. The inventories of P Ltd. include $4,000 of goods from s Ltd. invoiced to P Ltd. at cost plus 25% C. A cheque for $500 from P Ltd. to S Ltd. sent before 31st December 2018, was not received by the latter company until January 2019. d. An impairment review at 31st December 2018 revealed that an impairment loss of $500 in respect of goodwill on the acquisition of S Ltd. needs to be recognized. By 1 January 2018 this goodwill had already suffered impairments totaling $1,700. e. The non-controlling interest and goodwill arising on the acquisition of S Ltd. were both calculated using the proportionate method. Requirements: Determine the total amount of consideration paid by P Ltd to acquire S Ltd and prepare the consolidate statement of financial position of P Ltd. and its subsidiary S Ltd. as at 31 December 2018. (Show necessary workings) [15]
