ILLUSTRATION 3 Bryson acquired 75% of the issued share capital of Stoppard on 1 January 2021 for $8,720,000. At that date Stoppard had issued share capital of $4,800,000. For the year ended 31 March 2021, Stoppard made a profit after tax of $640,000. Extracts of the statements of financial position for the two entities at 31 March 2021 are as follows: Assets Investment in Stoppard Non-current assets Current assets Total assets Equity and liabilities Equity Share capital Retained earnings Total equity Non-current liabilities Current liabilities Bryson $000 8,720 11,280 5,760 25,760 $000 9,200 12,480 21,680 1,440 2,640 Stoppard $000 3,670 5,010 8,680 $000 4,800 1,290 6,090 1,180 1,410 Total equity and liabilities 25,760 8,680 The following information is relevant to the preparation of the consolidated financial statements: (i) At acquisition, the fair value of land owned by Stoppard exceeded its cost by $1,000,000. This land was still owned at 31 March 2021. (ii) During the year Bryson sold goods to Stoppard for $500,000 making a profit of $50,000. Eighty per cent of the goods remained in Stoppard's inventory at the year end. At 31 March 2021 Bryson was still owed half of the total amount invoiced to Stoppard for these goods. (iii) At 1 January 2021, the fair value of the non-controlling interest at the date of acquisition was $2,200,000. Required: Prepare the consolidated statement of financial position for Bryson plc and its subsidiary undertaking as at 31 March 2021.
ILLUSTRATION 3 Bryson acquired 75% of the issued share capital of Stoppard on 1 January 2021 for $8,720,000. At that date Stoppard had issued share capital of $4,800,000. For the year ended 31 March 2021, Stoppard made a profit after tax of $640,000. Extracts of the statements of financial position for the two entities at 31 March 2021 are as follows: Assets Investment in Stoppard Non-current assets Current assets Total assets Equity and liabilities Equity Share capital Retained earnings Total equity Non-current liabilities Current liabilities Bryson $000 8,720 11,280 5,760 25,760 $000 9,200 12,480 21,680 1,440 2,640 Stoppard $000 3,670 5,010 8,680 $000 4,800 1,290 6,090 1,180 1,410 Total equity and liabilities 25,760 8,680 The following information is relevant to the preparation of the consolidated financial statements: (i) At acquisition, the fair value of land owned by Stoppard exceeded its cost by $1,000,000. This land was still owned at 31 March 2021. (ii) During the year Bryson sold goods to Stoppard for $500,000 making a profit of $50,000. Eighty per cent of the goods remained in Stoppard's inventory at the year end. At 31 March 2021 Bryson was still owed half of the total amount invoiced to Stoppard for these goods. (iii) At 1 January 2021, the fair value of the non-controlling interest at the date of acquisition was $2,200,000. Required: Prepare the consolidated statement of financial position for Bryson plc and its subsidiary undertaking as at 31 March 2021.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:ILLUSTRATION 3
Bryson acquired 75% of the issued share capital of Stoppard on 1 January 2021 for $8,720,000.
At that date Stoppard had issued share capital of $4,800,000. For the year ended 31 March 2021,
Stoppard made a profit after tax of $640,000.
Extracts of the statements of financial position for the two entities at 31 March 2021 are as
follows:
Assets
Investment in Stoppard
Non-current assets
Current assets
Total assets
Equity and liabilities
Equity
Share capital
Retained earnings
Total equity
Non-current liabilities
Current liabilities
Bryson
$000
8,720
11,280
5,760
25,760
$000
9,200
12,480
21,680
1,440
2,640
Stoppard
$000
3,670
5,010
8,680
$000
4,800
1,290
6,090
1,180
1,410
Total equity and liabilities
25,760
8,680
The following information is relevant to the preparation of the consolidated financial statements:
(i) At acquisition, the fair value of land owned by Stoppard exceeded its cost by $1,000,000.
This land was still owned at 31 March 2021.
(ii) During the year Bryson sold goods to Stoppard for $500,000 making a profit of $50,000.
Eighty per cent of the goods remained in Stoppard's inventory at the year end. At 31
March 2021 Bryson was still owed half of the total amount invoiced to Stoppard for these
goods.
(iii) At 1 January 2021, the fair value of the non-controlling interest at the date of acquisition
was $2,200,000.
Required:
Prepare the consolidated statement of financial position for Bryson plc and its subsidiary
undertaking as at 31 March 2021.
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