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This is the whole Q provided Soran Ltd had the following balance sheet - Soran Ltd purchased a 30 percent shareholding in Krall Ltd on
This is the whole Q provided
Soran Ltd had the following balance sheet - Soran Ltd purchased a 30 percent shareholding in Krall Ltd on 1 Jan 20X8 for $90,000. This purchase resulted in Soran having significant influence over Krall. - Soran owns 15 percent and had significant influence in Dukat Ltd for last six years. - Soran Ltd does not have any share investments that confer control. - On 1 January 208 Krall's assets were recorded at fair values and its owners' equity, totalling $190,000, was: > share capital $150,000 > retained profits $40,000 - During the 208 year Krall reported profit of $90,000 and revalued its assets upwards by $70,000. - Dividend that Krall paid out of current year profit amounted to $60,000. - During the 20X8 year, Dukat Ltd sold inventory to Krall and made profit of $90,000. Half of this inventory was still held by Krall Ltd by year-end. Required: Prepare journal entries for Soran Ltd to record all events in 208 for its investment in Krall Ltd. Use Australian Accounting Standards but classify income from associates in a way that would provide appropriate information regarding prudent distribution of cash flows. Use the separate recognition methodStep by Step Solution
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