Question 1On 2 July 2005, H Ltd. purchased the entire issued ordinary share capital ofS Ltd. On this date, S Ltd. had a retained income balance of R4 000 and nogeneral reserve. Any purchase difference is to be attributed to the fixed assetsof S Ltd. On 30 June 2007, the trial balances of the two companies were asfollows:Share capital (R1 ordinary shares)General reserveRetained incomeAccumulated depreciationFixed assets at costInvestments in S Ltd.Net current assetsuestion 2H Ltd.R40 00010 00034 0006 000R90 00030 00036 00024 000R90 000buildings at costat costin S Ltd.S Ltd.R20 0005 00010 000Note: Included in the net current assets of both companies is a dividend dueby S Ltd. to H Ltd. of R2 000.RequiredDraw up a consolidated balance sheet of H Ltd. and subsidiary S Ltd. on30 June 2007.ordinary R1 shares)R35 00014 000H Ltd.R-21 000R35 000td. bought all the shares in S Ltd. on 30 June 2004 when the retainedme of S Ltd. was R8 000 and the general reserve was R12 000. Thewing list of balances appeared in the books of the two companies onne 2007.60 00044 00080 00048 00060 000R292 000S Ltd.R28 0024 0024 0280R104

Consolidation - Consolidation accounting is the procedure used to merge the financial outcomes of…

Question 1 On 2 July 2005, H Ltd. purchased the entire issued ordinary share capital of S Ltd. On this date, S Ltd. had a retained income balance of R4 000 and no general reserve. Any purchase difference is to be attributed to the fixed assets of S Ltd. On 30 June 2007, the trial balances of the two companies were as follows: Share capital (R1 ordinary shares) General reserve Retained income ppaniation H Ltd. R 40 000 10 000 34 000 6 000 S Ltd. R 20 000 5 000 10 000

Question 1 On 2 July 2005, H Ltd. purchased the entire issued ordinary share capital of S Ltd. On this date, S Ltd. had a retained income balance of R4 000 and no general reserve. Any purchase difference is to be attributed to the fixed assets of S Ltd. On 30 June 2007, the trial balances of the two companies were as follows: Share capital (R1 ordinary shares) General reserve Retained income ppaniation H Ltd. R 40 000 10 000 34 000 6 000 S Ltd. R 20 000 5 000 10 000

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

I wanna know the transaction of dt ct sides . 1.The company sold assets previously revalued by 150 through revaluation reserve. dt asset 150 ct revaluation reserve 150 2.the company issued to shareholders 100 shares at a nominal value of 1 and issue price of 4. I do not know this transaction. 3.The company purchased on deferred payment shares of X company for immediate sale 50 shares at a value of 5 per share and commission of 1 per share. dt short term investment 300 ct liabilities 300 ( I am considering if ct : deferred cost)
PROBLEM V. On January 2, 2020, P Company acquired 80% interest in S Company for P4,125,000 cash. On this date, the outstanding ordinary share capital and accumulated profits of P Company and S Company are as follows: P Company S Company Ordinary share capital P2,250,000 P1,312,000 Share premium 1,500,000 Accumulated profits (losses) 5,250,000 3,187,500 There was no issuance of ordinary shares during the year. Noncontrolling interest is initially measured at fair value. Fair value of the following assets of S Company exceeded their book values as follows: Inventories, P210,000; Property and equipment (remaining useful life 10 years), P127,500. All other assets and liabilities are fairly valued. Goodwill if any is not impaired. On December 31, 2020, the two companies reported the following operating results: P Company S Company Net income P1,785,000 P975,000 Dividends paid 525,000 262,500 1. Compute for the consolidated shareholders' equity.
The Consolidated/Group Net Income for 20x1: A. 356,500 B. 362,200 C. 363,075 D. 387,375
On February 18, 2018, Union Corporation purchased 10,000 shares of IBM bonds as a long-term investment for$600,000. Union will hold the bonds indefinitely, and may sell them if their price increases sufficiently. On December 31, 2018, and December 31, 2019, the market value of the bonds was $580,000 and $610,000, respectively.Required:1. What is the appropriate reporting category for this investment? Why?2. Prepare the adjusting entry for December 31, 2018.3. Prepare the adjusting entry for December 31, 2019.
Q2 Maenetja Limited acquired 1000 shares in Manana Limited on 1 December 2014 at the fair value of R15 per share. Transaction costs amounted to R200. At the date of acquisition the company elected to recognize subsequent changes in the fair value of this investment in other comprehensive income (OCI). The company’s policy is to release any gains or losses resulting from these fair value adjustments to retained earnings when the shares are sold. On 31 December 2014 the market value of Manana Limited’s shares was R18. On 30 June 2015, 200 shares were sold for R19.50. The market value of the shares at 31 December 2015 was R14. What are the correct journal entries that should be recorded initially when the shares purchased on 1 December 2014? Select one: a. DR Investment R15 000DR Transaction costs R200 CR Bank/Liability R15 200 b. DR Investment R15 000…
Problem 2At December 31, 20x4, Baby Corporation acquired all of Mommy Enterprises’ common stock. At that date, the book Values and fair values of Mommy’s identifiable assets and liabilities were identical. Balance sheet data for the individual companies and the consolidated entity on January 1, 20x5, are as follows: 1. Assuming there were no inventory transactions between the companies, what balance for inventory should be reported in the consolidated balance sheet?a. P 0b. P90,000c. P120,000d. P210,0002. What amount did Baby pay to acquire Mommy? Was this amount equal to, greater than, or less than underlying book value? How do you know?a. P110,000; P30,000 greater thanb. P110,000; P30,000 less thanc. Zero; P30,000 less thand. Zero; P30,000 greater than 3. Baby sold land it had purchased 12 years earlier for P10,000 to Mommy immediately after it acquired Mommy. At what price did baby sell the land to Mommy?a. P10,000b. P15,000c. P25,000d. P40,000
Appendix 7.0 Acquisition of BELL CorporationOn 1 January 2017, FIBERBOATS acquired 100% of BELL Corporation. FIBERBOATS issued 50,000 shares of its BD0.600 par ordinary shares, with a market price of BD0.400 on the date the acquisition was announced and BD0.800 on the date the acquisition was completed, for all of BELL Corporation ordinary shares. The book value of net assets of BELL Corporation at the date of acquisition was BD10,000. On that date, the fair value of BELL Corporation assets and liabilities equalled their respective carrying amounts with the exception of property, plant and equipment (PPE) that exceeded its book value by BD120,000. The fair value of BELL’s identifiable intangibles (in-process research and development) is BD70,000. The in-process research and development will be amortized over 5 years. Advise the management of FIBERBOATS on the accounting treatment in relation to the acquisition event that occurred on 1 January 2017 (see appendix 7). Your advice should…
5 MC Questions On 1 July 2019, Peter Limited acquired all the issued shares of Kerri Limited for $100 000 when the equity of Kerri Limited consisted of: Share capital $70 000 Retained earnings 30 000 The pre-acquisition entry at 1 July 2019 is: a. Shares in Kerri Limited Dr 100 000 Retained earnings Cr 30 000 Share capital Cr 70 000 b. Retained earnings Dr 30 000 Share capital Dr 70 000 Shares in Kerri Limited Cr 100 000 c. Retained earnings Dr 70 000 Share capital Dr 30 000 Shares in Kerri Limited Cr 100 000 d. Goodwill Dr 30 000 Share capital Dr 70 000 Shares in Kerri Limited Cr 100 000
Please Solve with Explanation anr Do not give image format
Question 1 On January 2020, RITZ Ltd acquired 80% of the ordinary shares of AUGE Ltd. The group accountant has calculated that the goodwill arising on acquisition was GH₵8,000,000. However, the financial controller has uncovered a number of errors and requires advice about how to resolve them. No entries have been posted in respect of contingent cash consideration that work be paid in 2025 if AUGE meets targets. The contingent consideration had a fair value of GH₵800,000 at acquisition and was calculated using a discount rate of 10% No fair value adjustment has been recorded in respect of AUGE’s non-depreciable land. This land had a carry amount of GH400,000 at acquisition and a fair value of GH₵600,000. AUGE’s brand is internally generated and has not been recognized in the consolidated financial statement. At acquisition it had a fair value of GH₵1,000,000 and a remaining estimated useful life of 5 years. Acquisition cost of GH₵100,000 incurred towards the acquisition process has…
please dont provide answer in an image format thank you
Q25 On 1 June 2013, Sun Ltd acquired 75% interest (and control) over Savy Ltd by acquiring 570 000 of the issued ordinary shares of Savy Ltd. The consideration paid was settled in cash amounting to R810 000. On this date the retained earnings of Savy Ltd amounted to R125 000 and 760 000 ordinary shares worth R950 000. The Sun Ltd Group measures non-controlling interests in an acquiree at its proportional share of the aquiree’s identifiable net assets at acquisition date (partial goodwill method). On 31 December 2015, goodwill was tested for impairment and it was determined by the directors of Sun Ltd that the goodwill was impaired with R2 750 at the end of the current financial year. The amount that will be disclosed as goodwill in the consolidated statement of financial position of the Sun Ltd Group as at 31 December 2015, is_______. Select one: a. R1 000 b. RNIL c. R269 750 d. R3 750