224) $

Fair value at acquisition (200,000 × 30% × $1.75) 105,000

Share of post-acquisition retained earnings ((750 – 450) × 30%) 90,000
Depreciation on fair value adjustment ((250 / 40) × 30%) -1,875
193,125

225) $ $
Cash 250,000
Deferred consideration (400,000 / 1.08) 370,370
Shares (30,000 × $2.30) 69,000
689,370
Fair value of non-controlling interest 400,000
1,089,370
Fair value of net assets:
Shares 100,000
Retained earnings 850,000
-950,000
139,370

226)
($1.2 million / 8 × 4/12) × 80% = $40,000

227) Shares (18m × 2/3 × $5.75) 69000

Deferred consideration (18m × $2.42 × 1 / 1.12 36000
105000

228) This adjustment reduces (debits) the liability and the credit is to retained earnings. The
re-measurement relates to the post-acquisition period, so goodwill is not affected.

229) $ $
Consideration transferred 800000
Fair value of non-controlling interest 220000
1020000
Fair value of net assets:
Shares 100000
Retained earnings 570000
Revaluation surplus 150000
Intangible assets 90000
-910000
110000

230) Consideration 200,000

NCI 82,800
Net assets:
Shares 100,000
 Retained earnings 156,000 256,000
Goodwill 26,800
Phantom Co 275,000
Ghost Co:
(177 – 156) × 70% 14,700
Goodwill impairment (26,800 / 2) × 70% -9,380
Group retained earnings 280,320

232) Decrease 12
Increase ($2m × 25% (profit margin)) 0.5
Net decrease 11.5

233) Loss of investment income(10m × 8% × 6/12) -400

Saving of interest payable 400

234) Profit to 30 June 20X8 (1.6m × 6/12) 800,000

Additional depreciation on FVA ((2m/20) × 6/12) -50,000
Goodwill impairment -500,000
250,000
NCI share 20% 50,000

236) $2m × 25/ 125 × 20% = $80,000

237)
Profit for the year 1,300
Intragroup interest (5m × 8%) -400
Impairment (50,000 – 30,000) -20
880
x30% 264

239) $150,000 (450,000 – 300,000)

240) Disposal proceeds 950000

Goodwill on disposal (600,000 – (700,000 × 70%)) -110000
Share of net assets at disposal (850,000 × 70%) -595000
245000

242) The group's share of the associate's profit after tax is recorded as a one-line entry. Line by line
treatment would be correct for a subsidiary, not an associate. The dividends received from the
associate are all that is recorded in the individual entity financial statements of the parent, but in the
consolidated financial statements this is replaced by the group share of profit after tax.

244) Cost of investment 5000

Share of post-acquisition profit (8,500 – 7,400) × 25% 275
PURP (600 × 30% × 25%) -45
 5230

245) Cost of investment 10,000

Share of post-acquisition profit (6,000 × 8/12) – 1,000) × 30% 900
Impairment -700
10200

247) ($160,000 / 4) × 25% × 30% = $3,000

249) The revaluation gain on the factory will be presented under 'other comprehensive income'. The other
items will be recognised in profit or loss. Note that gains on investment properties go through profit
or loss.

250) Inventories, provisions and intangible assets are shown separately. There is no such requirement for
government grants.

251) The time between acquisition of assets for processing and receipt of cash from customers

253) B/f (500 + 100) 600

Cash received 500
C/f (750 + 350) 1100

254) Balance b/f 1860

Revaluation 100
Disposal -240
Depreciation -280
1440
1440
Balance c/f 2880

256) 410
Depreciation -115
Revaluation 80
Purchases 305
680

257) B/f (2,000 + 800) 2800

Additions (6,500 – 2,500 + 1,800) 5800
Payments made -2100
C/f (4,800 + 1,700) 6500

259) Acquisition Movement $7 million × 80% = $5.6 mil

Property 20 -2
Brand 25 -5
-7
260) $16 million
$56m × 40/140

261) DR Cost of sales / CR Inventories

The unrealised profit is added to cost of sales and removed from inventories.

262) Control of the subsidiary has been lost.

Exclusion from consolidation is only allowed when control has been lost.

264) Net assets at date of acquisition

Share capital 100
Share premium 85
Retained earnings 331 – (96 × 2/12) 315
500

265) The non-controlling interest share of profit is part of the consolidated statement of profit or loss.
If a subsidiary is acquired during the year, its results are apportioned over the year of acquisition.
The statement of financial position shows all non-current assets. Goodwill is not amortised, it is subject to
an annual impairment review.

266) $364,000 and Alfred Co ($240,000 × 2/12) = $404,000

267)
Port retained earnings 2,900
Alfred post-acquisition (96,000 × 2/12) 16
Share of Alfred Co: (16 × 75%) 12
2912

269) (110m + (66m × 6/12) – 13m intragroup)

270) DR Liability / CR Profit or loss

This fall has taken place since acquisition, so goodwill is not adjusted.

271) Unrealised profit = 9m – 5.4m = 3.6m

Still in inventory = 3.6m × 1.5/9 = 600,000 × 25% = 150,000

272) The non-controlling interest will be allocated their share of any goodwill impairment.
The other options are incorrect.

273) $12,750,000 ((3m / 2 × $6) + (3m × $1.25))

274) The contract is estimated to have an indefinite life.

276) Cost (4m × 30% × $7.50) 9000

 Share of post-acquisition retained earnings (5,000 × 30%) 1500
10500

277) Axle Co is not a member of the group, so group inventory is unaffected.

ent, but in the
me'. The other
hrough profit

quirement for

$7 million × 80% = $5.6 million

sed, it is subject to