UNIT 3 DISCUSSION PRACTICE QUESTION

The summarized statements of financial position of Close and Steele as at December 31, 2012 were as follows:

CloseSteele

$$

Assets

Non-current assets

Tangible assets84,00058,200

Investments80,000

Current assets

Current accounts - Close3,200

Cash at bank10,0003,000

Investments2,500

Trade receivables62,70021,100

Inventory18,00012,000

254,700100,000

Equity and Liabilities

Trade payables35,00011,000

Current account - Steele2,700-

Called up share capital ($1 ordinary shares)120,00060,000

Share premium account18,000

Revaluation surplus on January 1, 201223,00016,000

Retained earnings on January 1, 201240,0008,000

Profit for 201216,0005,000

254,700100,000

Additional information

(1)On December 31, 2011, Close acquired 48,000 shares in Steele for $80,000 cash.

(2)The inventory of Close includes $4,000 goods from Steele invoiced to Close at cost plus 25%.

(3)A payment for $500 by Close to Steele, sent before December 31, 2012, was not received by Steel until January 2013.

(4)Goodwill has been impaired by $7,800 since the acquisition took place.

(5)Non-controlling interest is valued at the proportionate share of the subsidiary's identifiable net assets; it is not credited with its share of goodwill.

Required:

Prepare the consolidated statement of financial position of Close and its subsidiary Steele as at December 31, 2012.

UNIT 3 DISCUSSION PRACTICE QUESTION The summarized statements of financial position of Close and Steele as at December 31, 2012 were as follows: Close Steele $ $ Tangible assets 84,000 58,200 Investments 80,000 Assets Non-current assets Current assets Current accounts - Close Cash at bank 3,200 10,000 Investments 3,000 2,500 Trade receivables 62,700 21,100 Inventory 18,000 12,000 254,700 100,000 Trade payables 35,000 11,000 Current account - Steele 2,700 - Called up share capital ($1 ordinary shares) 120,000 60,000 Share premium account 18,000 Revaluation surplus on January 1, 2012 23,000 16,000 Retained earnings on January 1, 2012 40,000 8,000 Profit for 2012 16,000 5,000 254,700 100,000 Equity and Liabilities Additional information (1) On December 31, 2011, Close acquired 48,000 shares in Steele for $80,000 cash. (2) The inventory of Close includes $4,000 goods from Steele invoiced to Close at cost plus 25%. (3) A payment for $500 by Close to Steele, sent before December 31, 2012, was not received by Steel until January 2013. (4) Goodwill has been impaired by $7,800 since the acquisition took place. (5) Non-controlling interest is valued at the proportionate share of the subsidiary's identifiable net assets; it is not credited with its share of goodwill. Required: Prepare the consolidated statement of financial position of Close and its subsidiary Steele as at December 31, 2012