QUESTION ONE: The information below relates to sail and its subsidiary wave. 31st December 2015 SAIL UShs’000 SAIL UShs’000 WAVE UShs’000 WAVE UShs’000 Non- current assets Property plant and equipment 350 95 Fixtures 150 55 Investment In subsidiary 250 750 0 150 Current assets inventory 210 75 Receivables 155 155 Bank 150 515 0 230 Share capital (shs 1 shares) 800 170 Retained earnings 150 65 Current liabilities Payables 295 75 Bank overdraft 20 315 70 145 The following is relevant; Group policy is to measure non – controlling interests at fair value. The fair value of the shares of wave at the point of acquisition was UShs 1.20. Sail purchased 75% of the issued share capital of wave four years ago, when the retained earnings of wave were UShs 20,000. There has been no impairment of goodwill. At the point of acquisition all net assets of wave were at fair value with the exception of an item of plant with a fair value of UShs 15,000 in excess of its carrying amount. The remaining useful life at the point of acquisition was 5 years. In the post-acquisition period Sail sells goods to Wave at a constant mark-up 0f 25%. At 31st December 2015 UShs 60,000 of goods sold to wave are in inventory Intergroup balance show confirmed payable and receivable balances of UShs 20,000 at the reporting date. Required:Prepare the consolidated statement of financial position as at 31st December 2015.
QUESTION ONE: The information below relates to sail and its subsidiary wave. 31st December 2015 SAIL UShs’000 SAIL UShs’000 WAVE UShs’000 WAVE UShs’000 Non- current assets Property plant and equipment 350 95 Fixtures 150 55 Investment In subsidiary 250 750 0 150 Current assets inventory 210 75 Receivables 155 155 Bank 150 515 0 230 Share capital (shs 1 shares) 800 170 Retained earnings 150 65 Current liabilities Payables 295 75 Bank overdraft 20 315 70 145 The following is relevant; Group policy is to measure non – controlling interests at fair value. The fair value of the shares of wave at the point of acquisition was UShs 1.20. Sail purchased 75% of the issued share capital of wave four years ago, when the retained earnings of wave were UShs 20,000. There has been no impairment of goodwill. At the point of acquisition all net assets of wave were at fair value with the exception of an item of plant with a fair value of UShs 15,000 in excess of its carrying amount. The remaining useful life at the point of acquisition was 5 years. In the post-acquisition period Sail sells goods to Wave at a constant mark-up 0f 25%. At 31st December 2015 UShs 60,000 of goods sold to wave are in inventory Intergroup balance show confirmed payable and receivable balances of UShs 20,000 at the reporting date. Required:Prepare the consolidated statement of financial position as at 31st December 2015.
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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Question
QUESTION ONE:
The information below relates to sail and its subsidiary wave.
|
31st December 2015 |
SAIL UShs’000 |
SAIL UShs’000 |
WAVE UShs’000 |
WAVE UShs’000 |
|
Non- current assets |
|
|
|
|
|
Property plant and equipment |
350 |
|
95 |
|
|
Fixtures |
150 |
|
55 |
|
|
Investment |
|
|
|
|
|
In subsidiary |
250 |
750 |
0 |
150 |
|
Current assets |
|
|
|
|
|
inventory |
210 |
|
75 |
|
|
Receivables |
155 |
|
155 |
|
|
Bank |
150 |
515 |
0 |
230 |
|
Share capital (shs 1 shares) |
|
800 |
|
170 |
|
|
|
|
|
|
|
|
|
150 |
|
65 |
|
Current liabilities |
|
|
|
|
|
Payables |
295 |
|
75 |
|
|
Bank overdraft |
20 |
315 |
70 |
145 |
The following is relevant;
- Group policy is to measure non – controlling interests at fair value. The fair value of the shares of wave at the point of acquisition was UShs 1.20.
- Sail purchased 75% of the issued share capital of wave four years ago, when the retained earnings of wave were UShs 20,000. There has been no impairment of
goodwill .
- At the point of acquisition all net assets of wave were at fair value with the exception of an item of plant with a fair value of UShs 15,000 in excess of its carrying amount. The remaining useful life at the point of acquisition was 5 years.
- In the post-acquisition period Sail sells goods to Wave at a constant mark-up 0f 25%. At 31st December 2015 UShs 60,000 of goods sold to wave are in inventory
- Intergroup balance show confirmed payable and receivable balances of UShs 20,000 at the reporting date.
Required:Prepare the consolidated
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