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Task 7 a. Complete the consolidation worksheet. Consolidation Worksheet 30 June 2017 Sales Inventory 01/07/2016 Consolidated Statements South Ltd West Ltd Eliminations Dr Cr 900,000 500,000 70,000 60,000 510.000 580,000 Purchases 400.000 460,000 Inventory 30/06/2017 Less Cost of Goods Sold 90.000 490,000 80.000 380,000 120,000 40.000 80,000 Gross Profit 410,000 210.000 200,000 Expenses Add Other Income Profit on Sale of Plant 10,000 Interest Income 750 Dividends from West Ltd Profit before Tax 30.000 240,750 80,000 Less Income Tax expense 90.000 150,750 80,000 230,750 30.000 50.000 40,000 90,000 Profit Retained Earnings 01/07/2016 Available Appropriations: Dividend - Paid Dividend - Declared 40,000 50,000 30,000 20,000 Total Appropriations Retained Earnings 30/06/2017 General Reserve 50.000 40,000 50,000 90.000 140,750 100,000 Share Capital Dividend Payable Other Current Liabilities Non-Current Liabilities 200,000 50,000 100,000 20,000 60,000 20,000 290,000 110,000 60,000 660,750 Shares in West Ltd 160,000 Plant and Equipment (net) Inventory Other Assets 260,000 90,000 150,750 120,000 80,000 90,000 Goodwill on Consolidation Accum Impairment - Goodwill 660,750 290,000

Task 7 a. Complete the consolidation worksheet. Consolidation Worksheet 30 June 2017 Sales Inventory 01/07/2016 Consolidated Statements South Ltd West Ltd Eliminations Dr Cr 900,000 500,000 70,000 60,000 510.000 580,000 Purchases 400.000 460,000 Inventory 30/06/2017 Less Cost of Goods Sold 90.000 490,000 80.000 380,000 120,000 40.000 80,000 Gross Profit 410,000 210.000 200,000 Expenses Add Other Income Profit on Sale of Plant 10,000 Interest Income 750 Dividends from West Ltd Profit before Tax 30.000 240,750 80,000 Less Income Tax expense 90.000 150,750 80,000 230,750 30.000 50.000 40,000 90,000 Profit Retained Earnings 01/07/2016 Available Appropriations: Dividend - Paid Dividend - Declared 40,000 50,000 30,000 20,000 Total Appropriations Retained Earnings 30/06/2017 General Reserve 50.000 40,000 50,000 90.000 140,750 100,000 Share Capital Dividend Payable Other Current Liabilities Non-Current Liabilities 200,000 50,000 100,000 20,000 60,000 20,000 290,000 110,000 60,000 660,750 Shares in West Ltd 160,000 Plant and Equipment (net) Inventory Other Assets 260,000 90,000 150,750 120,000 80,000 90,000 Goodwill on Consolidation Accum Impairment - Goodwill 660,750 290,000

Essentials Of Investments
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
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Please find the attached screenshot of the question and you will be able to solve the question. it is just a consolidation worksheet.

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Case Study 7 On 1 July 2017 South Ltd acquired all the share capital of West Ltd for $160,000. At that date the accounts of West Ltd show the following: Share capital General reserve Retained earnings $100,000 30,000 20,000 Additional information for the year ended 30 June 2017 1. Sales by West Ltd to South Ltd during the year amounted to $ 110,000. 2. Unrealised profit in inventory of South Ltd: 01/07/2016 30/06/2017 $5,000 $3,000 3. On 1 January 2010 South Ltd sold an item of plant to West Ltd for $45,000, making a profit on the sale of $10,000. West Ltd depreciates plant at 20% per annum on cost. 4. Included in the other assets of South Ltd is a three-year loan of $20,000 at 15% per annum to West Ltd made on 1 April 2017. Three months interest was accrued by both companies at 30 June 2016. 5. Goodwill is tested annually for impairment; goodwill has been impaired by: $1,000 for the year ended 30 June 2016; and $2,000 for the year ended 30 June 2017.
Transcribed Image Text:Case Study 7 On 1 July 2017 South Ltd acquired all the share capital of West Ltd for $160,000. At that date the accounts of West Ltd show the following: Share capital General reserve Retained earnings $100,000 30,000 20,000 Additional information for the year ended 30 June 2017 1. Sales by West Ltd to South Ltd during the year amounted to $ 110,000. 2. Unrealised profit in inventory of South Ltd: 01/07/2016 30/06/2017 $5,000 $3,000 3. On 1 January 2010 South Ltd sold an item of plant to West Ltd for $45,000, making a profit on the sale of $10,000. West Ltd depreciates plant at 20% per annum on cost. 4. Included in the other assets of South Ltd is a three-year loan of $20,000 at 15% per annum to West Ltd made on 1 April 2017. Three months interest was accrued by both companies at 30 June 2016. 5. Goodwill is tested annually for impairment; goodwill has been impaired by: $1,000 for the year ended 30 June 2016; and $2,000 for the year ended 30 June 2017.
Task 7 a. Complete the consolidation worksheet. Consolidation Worksheet South Ltd West Ltd Eliminations Consolidated 30 June 2017 Sales Dr Cr Statements Inventory 01/07/2016 900,000 70,000 500,000 60,000 Purchases 510.000 400.000 580,000 460,000 Inventory 30/06/2017 Less Cost of Goods Sold 80.000 90.000 490,000 380,000 Gross Profit 410,000 210.000 200,000 120,000 40.000 80,000 Expenses Add Other Income Profit on Sale of Plant 10,000 Interest Income 750 Dividends from West Ltd Profit before Tax 30.000 240,750 80,000 Less Income Tax expense 30.000 90.000 150,750 80,000 Profit 50,000 40,000 Retained Earnings 01/07/2016 Available Appropriations: 230,750 90,000 Dividend - Paid Dividend - Declared 40,000 50,000 30,000 20.000 Total Appropriations Retained Earnings 30/06/2017 90.000 50.000 140,750 100,000 40,000 50,000 General Reserve Share Capital Dividend Payable 200,000 50,000 100,000 110,000 60,000 660,750 20,000 60,000 20,000 290,000 Other Current Liabilities Non-Current Liabilities Shares in West Ltd. 160,000 Plant and Equipment (net) Inventory Other Assets Goodwill on Consolidation Accum Impairment - Goodwill 260,000 90,000 120,000 80,000 150,750 90,000 660,750 290,000
Transcribed Image Text:Task 7 a. Complete the consolidation worksheet. Consolidation Worksheet South Ltd West Ltd Eliminations Consolidated 30 June 2017 Sales Dr Cr Statements Inventory 01/07/2016 900,000 70,000 500,000 60,000 Purchases 510.000 400.000 580,000 460,000 Inventory 30/06/2017 Less Cost of Goods Sold 80.000 90.000 490,000 380,000 Gross Profit 410,000 210.000 200,000 120,000 40.000 80,000 Expenses Add Other Income Profit on Sale of Plant 10,000 Interest Income 750 Dividends from West Ltd Profit before Tax 30.000 240,750 80,000 Less Income Tax expense 30.000 90.000 150,750 80,000 Profit 50,000 40,000 Retained Earnings 01/07/2016 Available Appropriations: 230,750 90,000 Dividend - Paid Dividend - Declared 40,000 50,000 30,000 20.000 Total Appropriations Retained Earnings 30/06/2017 90.000 50.000 140,750 100,000 40,000 50,000 General Reserve Share Capital Dividend Payable 200,000 50,000 100,000 110,000 60,000 660,750 20,000 60,000 20,000 290,000 Other Current Liabilities Non-Current Liabilities Shares in West Ltd. 160,000 Plant and Equipment (net) Inventory Other Assets Goodwill on Consolidation Accum Impairment - Goodwill 260,000 90,000 120,000 80,000 150,750 90,000 660,750 290,000
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