Adjustments to Current

Year's Profit
Draft profit for the year 112,200
Derecognised contract - 1,800
Depreciation expense - 47,100
Gain on investment property 1,000
Irrecoverable debt - 2,500
Tax expense - 12,200
Adjusted profit for the year 49,600

Statement of Financial Position

Assets
Non-current assets
Property 180,000
Plant 144,400
Investment property 13,500
Current assets
Inventory 90,000
Trade receivables 40,400
Cash 3,800
Total assets 472,100
Equity and liablities
Equity
Share capital 250,000
Share premium 40,000
Revaluation surplus 22,800
Retained earnings 44,900
Liabilities
Non-current liablities
Deferred tax 21,200
Current liablities 93,200
Total equity and liablities 472,100
Notes:

Note 1
Revenue - 7,800
Cost of sales - 6,000
Profit - 1,800
Inventory 6,000
Receivables - 7,800

Note 2
b/f CA Depreciation
Land 20,000 -
Building 165,000 11,000
Plant 180,500 36,100

Depreciation expense 47,100

Note 3
CA b/f Gain
Investment Property 12,500 1,000

Note 4
Receivables - 4,000
Irrecoverable debt 2,500
Retained earnings - 4,000

Note 5
Increase in Deferred tax 2,000
deferred tax on revaluation 1,200

Note 6
Tax estimate 11,400
Increase in Deferred tax 2,000
deferred tax on revaluation 1,200
Tax expense for the year 12,200

Note 7 Right issue of shares

Shares issued 50,000

Dr Cash 60,000
Cr Share capital 50,000
Cr Share premium 10,000

Note 8
Dividend paid 15,500

Statement of Changes in Equity

Share capital Share premium

Balance b/f 200,000 30,000
Share issued 50,000 10,000
Profit for the year
Dividend paid
Adjustment to previous year
Revaluation gain
Deferred tax on revaluation
Balance c/f 250,000 40,000
Revaluation CA c/f

6,000 20,000
160,000
- 144,400

CA c/f
13500
Revaluation surplus Retained earnings Total equity
18,000 12,300 260,300
60,000
49,600 49,600
- 15,500 - 15,500
- 1,500
6,000 6,000
- 1,200 - 1,200
22,800 44,900 357,700
Consolidated Statement of Financial Positi (W1)Group Structure
on Name Label
Assets Petrel Co Parent
Non-current assets Storm Co Subsidiary

PPE 28,400 Auk Co Associate

Goodwill 4,500
Brand name 1,000 (W2)-Net assets of Sub
Financial asset investments 9,000 Acquisition

Investment in associate 10,500 Share capital 4,000

Current assets Retained earnings 6,000
Inventory 12,800 Fair value adjustment 1,000
Trade receivables 4,700 Excess depreciation -
Total assets 70,900 PUP -
Equity and liablities 11,000
Equity
Share capital 11,500 (W3)-Goodwill
Share premium 7,500 Total Consideration paid 12,750

Group Retained earnings 30,275 NCI at acq 2,750

NCI 3,425 Net assets of sub 11,000
Liabilities Goodwill at acq 4,500
Non-current liablities
Loan note 6,000 (W4)-NCI
Current liabilities 12,200 NCI at acq 2,750
Total equity and liabilities 70,900 Share of post-acq reserves of S 675

3,425

(W5)- Retained earnings

RE of parent 25,250
Share post acq reserves of S 2,025
Share of A's post-acq profit 1,500
PUP - 500

Gain on financial investment 2,500

30,775

(W6)-Cost of investment in A
Initial cost 9,000
Share of A's post-acq profit 1,500
10,500
 Consideration Paid
% holding Acq period Share for share exchange 9,000 Shares issued
Cash paid 3,750 Share capital
1 Full year Total consideration 12,750 Share premium

0 Full year
Professional Costs 500

Reporting Post-acq Cost of investment in A 9,000

4,000 -
8,900 2,900 Notes:
1,000 -
100 100 Note 1
- 300 - 300 RE at acq 6,000
13,700 2,700 Fair value adjustment 1,000

Note 2
With transfer Without transfer

Cost 2,500 2,000 500

Depreciation 500 400 100
CA 2,000 1,600

Note 3
Intra-group sales 2,700
PUP of Subsidiary 300

Inventory - 300

Note 4
NCI at acq 2,750

Note 6
Financial asset investments 9,000

Gain 2,500
1,500
1,500
7,500
Consolidated statement of Profit or Loss (W1)-Group Structure
Name Label
Revenue 270000 Pandar Co Parent
Cost of Sales 162500 Salva Co Subsidiary
Gross Profit 107500 Ambra Co Associate
Distribution costs 14700
Admin expenses 22800 (W2)-Net assets of Sub
Investment income 1100 Acquisition
Finance costs 2300 Share capital 120000
Share of loss of Associate 4000 Retained earnings 163500
Profit before tax 64800 Fair value adjustments 25000
Income tax expense 20000 308500
Profit for the year 44800
(W3)-Goodwill
Profit attributable to: Consideration paid 345600
Parent 43000 NCI at acq 76800
NCI 1800 Net assets of Sub 308500
Goodwill at acq 113900

(W4)-Share of A's profit

Post-acq loss share 1000
 Consideration paid
% holding Acq period Share for share exchange 345600 Shares issued 57600

80% 6 months Cost of investment in A 32000

40% 6 months
Notes:

Note 1
Fair value adjustment of plant 5000
Extra depreciation 500 COS

Domain name 20000

Note 2
Finance cost -2000
Investment income -2000

Note 3
Dividend 6400
Investment income -6400

Note 4
Intra-group sales 15000
PUP of parent 1000

Note 5
NCI at acquistion 76800

Note 6
Impairment of investment in A 3000