The following are the statement of financial positions of Sham Ltd and its subsidiary

Rock Ltd at 30.06.2003

Sham Ltd Rock Ltd
£ £
ASSETS
Non-Current assets
Property, Plant and Equipment 275,000 120,000

Investment in Rock Ltd (75,000 £1 100,000

shares at cost)

Current Assets
Inventories 70,000 45,000
Trade receivables 55,000 25,000
Bank 30,000 20,000
155,000 90,000
Total Assets 530,000 210,000
====== ======
EQUITY AND LIABILITIES
Capital and Earnings
Ordinary Share Capital 350,000 125,000
Retained earnings 120,000 40,000
470,000 165,000

Current Liabilities
Trade payables 60,000 45,000
Total equity and liabilities 530,000 210,000
====== ======

• On 1st July 2000 Sham Ltd acquired the shares in Rock Ltd. At that time Rock
Ltd had retained earnings of £25,000. Goodwill has suffered an impairment of
30%.
• The inventory held by Sham Ltd includes goods purchased from Rock Ltd for
£12,000. Rock Ltd had taken a profit of 50% on cost.
• Sham Ltd is indebted to Rock Ltd to the sum of £6000 for goods purchased
You are required:
To prepare the consolidated statement of financial position as at 30.06.2003
The following are the statement of financial positions of Gem Ltd and its subsidiary
Stone Ltd at 30.06.2003
Gem Ltd Stone Ltd
£ £
ASSETS
Non-Current assets
Property, Plant and Equipment 345,000 157,000

Investment in Stone Ltd (75,000 £1 120,000

shares at cost)

Current Assets
Inventories 55,000 25,000
Trade receivables 35,000 15,000
Bank 40,000 15,000
130,000 55,000
Total Assets 595,000 212,000
====== ======
EQUITY AND LIABILITIES
Capital and Earnings
Ordinary Share Capital 400,000 100,000
Retained earnings 150,000 82,000
550,000 182,000

Current Liabilities
Trade payables 45,000 30,000
Total equity and liabilities 595,000 212,000
====== ======

• On 1st July 1994 Gem Ltd acquired the shares in Stone Ltd. At that time Stone
Ltd had retained earnings of £25,000. Goodwill has suffered a 90% impairment.
• The inventory held by Stone Ltd includes goods purchased from Gem Ltd for
£15,000. Gem Ltd had taken a profit of 25% on cost.
• Stone Ltd is indebted to Gem Ltd to the sum of £4000 for goods purchased
You are required:
To prepare the consolidated statement of financial position as at 30.06.2003