Non-depreciable fixed property with an original cost price

Assignment Help Accounting Basics
Reference no: EM131135461

Assignment 1

STATEMENTS OF FINANCIAL POSITION AS AT 30 JUNE 2012


P LTD

S LTD

ASSETS



Fixed property

70 000

48 500

Plant

6 400

5 000

Gross carrying amount

10 000

12 500

Accumulated depreciation

(3 600)

(7 500)

Furniture

2 500

1 500

Gross carrying amount

5 000

5 000

Accumulated depreciation

(2 500)

(3 500)

Investment in S Ltd at fair value:37 500 shares (cost: $52 500)

52 500

-

Investment in unlisted shares

-

12 500

Current account: S Ltd

10 000

-

Trade receivables

22 500

11 500

Inventories

8 000

14 000

Bank

26 925

31 875

Total assets

198 825

124 875




EQUITY AND LIABILITIES



Share capital (100 000/50 000 shares)

100 000

50 000

Retained earnings

77 325

49 000

Current account: P Ltd

-

4 375

Dividend payable

5 000

7 500

Trade & other payables

16 500

14 000

Total equity and liabilities

198 825

124 875




STATEMENTS OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME

FOR THE YEAR ENDED 30 JUNE 2012


P LTD

S LTD

Revenue

100 000

75 000

Cost of sales

(55 000)

(55 000)

Gross profit

45 000

20 000

Other expenses

(15 075)

(4 525)

Dividend received

5 625

500

Interest received

2 400


Profit before tax

37 950

15 975

Income tax expense

(10 625)

(4 475)

PROFIT FOR THE YEAR

27 325

11 500

Other comprehensive income for the year

-

-

TOTAL COMPREHENSIVE INCOME FOR THE YEAR

27 325

11 500

EXTRACT FROM THE STATEMENTS OF CHANGES IN EQUITY

FOR THE YEAR ENDED 30 JUNE 2012


P LTD

S LTD

Balance at 1 July 2011

60 000

45 000

Changes in equity for 2012



Total comprehensive income for the year:



Profit for the year

27 325

11 500

Ordinary dividend paid and provided

(10 000)

(7 500)

Balance at 30 June 2012

77 325

49 000

Additional information

  1. P Ltd acquired the interest in S Ltd on 30 June 2009 when the equity of S Ltd was as follows;

    Share Capital $50 000

    Retained earnings $17 500

  2. On 1 January 2010, S Ltd sold non-depreciable fixed property with an original cost price of $25 000 to S Ltd for $28 500. The property is classified as property, plant and equipment and still in possession of S Ltd.

  3. On 30 June 2011, S Ltd sold furniture that cost $6 250 and on which accumulated depreciation to the amount of $1 250 was recognized to P Ltd for $5 000. P Ltd classifies this furniture under property, plant and equipment.

  4. S Ltd purchases all its inventories from P Ltd at cost price plus 25%. Total inventories to the value of $37 500 were sold to S Ltd by P Ltd during the reporting period. Inventories in the records of S Ltd were $12 500 on 1 July 2011. At the end of the reporting period, S Ltd owed P Ltd $11 500 in respect of the inventories purchased from P Ltd. These amounts are included in trade receivables and trade & other payables.

  5. On 30 June 2010, S Ltd sold 2 machines with a carrying amount of $9 000 each to P Ltd for a total amount of $20 000. P Ltd uses the plant in the production of inventories. Both companies write off depreciation on plant at 20% per annum on the diminishing balance method. On 29 June 2012, P Ltd sold one of the machines at a slight profit that was set off against other expenses.

  6. Assume that the identifiable assets acquired and the liabilities assumed at acquisition date are shown at their acquisition-date fair values, as determined in terms of IFRS 3.

  7. P Ltd classified the equity investment in S Ltd under IFRS 9 in its separate financial statements and recognized fir value adjustments in a mark-to-market reserve (other comprehensive income).

  8. P Ltd elected to measure any non-controlling interests in an acquiree at their proportional share of the acquiree's identifiable net assets.

  9. Ignore deferred tax implications

    Required

    Prepare the following consolidated statements for the P Ltd Group for the reporting period ended 30 June 2012.

  1. Consolidated statement of financial position 22 marks

  2. Consolidated statement of changes in equity 7 marks

  3. Analysis of owner's equity 11marks

Reference no: EM131135461

Questions Cloud

Determine whether or not to change that strategy : Identify any considerations to be used when building or maintaining the brand or customer loyalty. Evaluate the target audience's use of and belief in the distribution channels and/or communication channels used.
What is the required current in the infinite wire : What is the required current in the infinite wire so the square loop will be in translational equilibrium?
Calculate the sales-volume variance : Calculate the sales-volume variance and flexible-budget variance for operating income - compute price and efficiency variances for direct materials and direct manufacturing labor.
Determine the hydrostatic force acting on the cylinder : Determine the hydrostatic force acting on the cylinder and its line of action when the gate opens.
Non-depreciable fixed property with an original cost price : On 1 January 2010, S Ltd sold non-depreciable fixed property with an original cost price of $25 000 to S Ltd for $28 500. The property is classified as property, plant and equipment and still in possession of S Ltd.
Mixed-model sequences best reflects the lean philosophy : For a company with a product mix of 40 percent of product A and 30 percent each of products B and C, which of the following mixed-model sequences best reflects the lean philosophy?
Major impact that digital media has had on world of business : One major impact that digital media has had on the world of business is that:
How do functional silos prevent process integration : Describe the linkage between supply chain strategies and internal functional strategies and policies. How do functional silos prevent process integration? What are the eight key supply chain business processes, and why are they important when managin..
Assets liabilities and stockholders equity : LO.2-LO.5 (Master budget preparation) Kalogridis Corp. manufactures industrial dye. The company is preparing its 2011 master budget and has presented you with the following information:

Reviews

Write a Review

Accounting Basics Questions & Answers

  How much control does fed have over this longer real rate

Hubbard argues that the Fed can control the Fed funds rate, but the interest rate that is important for the economy is a longer-term real rate of interest.   How much control does the Fed have over this longer real rate?

  Coures:- fundamental accounting principles

Coures:- Fundamental Accounting Principles: - Explain the goals and uses of special journals.

  Accounting problems

Accounting problems,  Draw a detailed timeline incorporating the dividends, calculate    the exact Payback Period  b)   the discounted Payback Period. the IRR,  the NPV, the Profitability Index.

  Write a report on internal controls

Write a report on Internal Controls

  Prepare the bank reconciliation for company

Prepare the bank reconciliation for company.

  Cost-benefit analysis

Create a cost-benefit analysis to evaluate the project

  Theory of interest

Theory of Interest: NPV, IRR, Nominal and Real, Amortization, Sinking Fund, TWRR, DWRR

  Liquidity and profitability

Distinguish between liquidity and profitability.

  What is the expected risk premium on the portfolio

Your Corp, Inc. has a corporate tax rate of 35%. Please calculate their after tax cost of debt expressed as a percentage. Your Corp, Inc. has several outstanding bond issues all of which require semiannual interest payments.

  Simple interest and compound interest

Simple Interest, Compound interest, discount rate, force of interest, AV, PV

  Capm and venture capital

CAPM and Venture Capital

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd