Company’s name: Heather Berhad and Serenity Berhad

Additional information:

1. Investment Heather Berhad in Serenity Berhad:

RM
350,000 Ordinary Shares 350,000
180,000 8% Preferences Shares 180,000
10% Debentures 50,000
2. Heather Berhad acquired the shares and debentures in Serenity Berhad on 1 November 2022
when the balances Serenity Berhad’s reserve accounts were as follows:-
RM
General Reserves 40,000
Retained profits 50,000
3. On the date of acquisition, the property in Serenity Berhad was revalued at RM 300,000 and
the plant and machinery was revalued at RM 95,000. Serenity Berhad did not make any
adjustment in its books to show the new value of these assets.
4. Non-controlling interest is measured at fair value. The fair value of the Ordinary shares in
Serenity Berhad on the acquisition date was RM2 per share.
5. During the year, Serenity Berhad sold inventories for RM 18,000 to Heather Berhad at cost
plus 25%. Three quarter of these inventories has been sold.
6. During the current year, Heather Berhad sold motor vehicle with a carrying value of RM
20,000 for RM 35,000 to Serenity Bhd.
7. It is the group's policy to charge depreciation on plant and machinery and motor vehicles at
15% on the net book value.
8. The difference in current account is due to cash in transit.
9. Included in the account receivable of Heather Berhad is RM 12,000 due from Serenity
Berhad. However, Serinity Berhad sent RM5,000 on 30 October 2023, but this was only
received by Heather Berhad on 3 November 2023.
10. RM 1700 of the bills payable of Serenity Berhad was in favour of Heather of which RM 1,000
had been discounted.
11. At the end of the year, goodwill is impaired at 10% per annum.
12. The directors of both companies have declared:

Heather Berhad Serenity Berhad

Preference dividend Full-year Full-year
Ordinary dividend 10% 5%

13. The debenture interest for the full year has not recorded yet.