Create the pre-acquisition entries at June

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Reference no: EM132850074

Question - On 1 July 2020, Kerry Ltd acquired 100% of the issued shares of James Ltd on a cum div. basis. The fair value of the consideration paid was measured at $250,000. At this date, the records of James Ltd included the following information:

Share Capital	$200,000
Retained Earnings	$20,000
Asset Revaluation reserve	$5,000
Dividends payable	$5,000
Goodwill	$2,000

The dividend liability at 1 July 2020 was paid in September 2020. At 1 July 2020, all the identifiable assets and liabilities of James Ltd were recorded in the subsidiary's books at fair value except for the following assets:

	Carrying Amount	Fair Value
Inventory	$40,000	$56,000
Property and Equipment	$100,000	$115,000

Required - Create the pre-acquisition entries at 30 June 2021.

Reference no: EM132850074

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