Power acquired the shares of Super on 1 January 2016 when the retained profit and general reserve balances of Super were RM250,000 and RM50,000 respectively. On this date, the fair values of the non-current assets in Super were as follows: land RM500,000; buildings RM420,000 and plant & machinery RM560,000. The fair values have not been reflected in the books of Super. The original cost of the buildings was RM375,000 and buildings are depreciated over an estimated useful life of twenty-five years. On the date of acquisition, the plant and machinery had a remaining useful life of eight years. Depreciable non-current assets are depreciated using the straight-line method and depreciation charge for the year 2020 has been provided in the financial statements. The summarized statements of financial position of Power and Super as at 31 December 2020 were as follows: Land, at cost Buildings, at net book value Plant and machinery, at net book value Investment in Super 225,000 ordinary shares 40,000 5% preference shares Current assets 500,000 ordinary shares 300,000 ordinary shares 100,000 5% preference shares Retained profit General reserve Current liabilities Power RM 400,000 180,000 720,000 40,000 90,000 1,430,000 600,000 500,000 280,000 50,000 1,430,000 Super RM 335,000 225,000 240,000 75,000 875,000 375,000 100,000 200,000 120,000 80,000 875,000 Additional information: Included in the current assets of Power is RM35,000 due from Super. However, Super has remitted RM15,000 on 30 December 2020 which was received by Power on 2 January 2021. Required: The Consolidated Statement of Financial Position of the Power Group as at 31 December 2020. Include in your workings the relevant journal entries, Cost of Control account, Non-Controlling Interest account and Group Retained account.
Power acquired the shares of Super on 1 January 2016 when the retained profit and general reserve balances of Super were RM250,000 and RM50,000 respectively. On this date, the fair values of the non-current assets in Super were as follows: land RM500,000; buildings RM420,000 and plant & machinery RM560,000. The fair values have not been reflected in the books of Super. The original cost of the buildings was RM375,000 and buildings are depreciated over an estimated useful life of twenty-five years. On the date of acquisition, the plant and machinery had a remaining useful life of eight years. Depreciable non-current assets are depreciated using the straight-line method and depreciation charge for the year 2020 has been provided in the financial statements. The summarized statements of financial position of Power and Super as at 31 December 2020 were as follows: Land, at cost Buildings, at net book value Plant and machinery, at net book value Investment in Super 225,000 ordinary shares 40,000 5% preference shares Current assets 500,000 ordinary shares 300,000 ordinary shares 100,000 5% preference shares Retained profit General reserve Current liabilities Power RM 400,000 180,000 720,000 40,000 90,000 1,430,000 600,000 500,000 280,000 50,000 1,430,000 Super RM 335,000 225,000 240,000 75,000 875,000 375,000 100,000 200,000 120,000 80,000 875,000 Additional information: Included in the current assets of Power is RM35,000 due from Super. However, Super has remitted RM15,000 on 30 December 2020 which was received by Power on 2 January 2021. Required: The Consolidated Statement of Financial Position of the Power Group as at 31 December 2020. Include in your workings the relevant journal entries, Cost of Control account, Non-Controlling Interest account and Group Retained account.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Power acquired the shares of Super on 1 January 2016 when the retained profit and general reserve
balances of Super were RM250,000 and RM50,000 respectively. On this date, the fair values of
the non-current assets in Super were as follows: land RM500,000; buildings RM420,000 and plant
& machinery RM560,000. The fair values have not been reflected in the books of Super. The
original cost of the buildings was RM375,000 and buildings are depreciated over an estimated
useful life of twenty-five years. On the date of acquisition, the plant and machinery had a remaining
useful life of eight years. Depreciable non-current assets are depreciated using the straight-line
method and depreciation charge for the year 2020 has been provided in the financial statements.
The summarized statements of financial position of Power and Super as at 31 December 2020 were
as follows:
Power
Super
RM
RM
400,000
180,000
Land, at cost
Buildings, at net book value
Plant and machinery, at net book value
Investment in Super
225,000 ordinary shares
40,000 5% preference shares
Current assets
335,000
225,000
240,000
720,000
40,000
90,000
75,000
1,430,000
875,000
500,000 ordinary shares
300,000 ordinary shares
100,000 5% preference shares
Retained profit
General reserve
Current liabilities
600,000
375,000
100,000
200,000
120,000
500,000
280,000
50,000
1,430,000
80,000
875,000
Additional information:
Included in the current assets of Power is RM35,000 due from Super. However, Super has remitted
RM15,000 on 30 December 2020 which was received by Power on 2 January 2021.
Required:
The Consolidated Statement of Financial Position of the Power Group as at 31 December 2020.
Include in your workings the relevant journal entries, Cost of Control account, Non-Controlling
Interest account and Group Retained account.
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