Question Details

(solution) This week, you will review financial statements of various parent


This week, you will review financial statements of various parent organisations and the subsidiaries that they acquired. You will be asked to develop consolidated financial statements for the groups under different scenarios

PLZ I want the answers with the calculation technique




International Financial Reporting and Analysis

 

Week 7: Assignment

 

Hand-In Assignment

 

This week, you will review financial statements of various parent organisations and

 

the subsidiaries that they acquired. You will be asked to develop consolidated

 

financial statements for the groups under different scenarios.

 

Part 1

 

On January 1, 20X1, Company X acquired 80% of the 15,000 £1 common shares in

 

Company 123 for £1.50 per share in cash and gained control. The retained earnings

 

of Company 123 were £5,000 at that time. The fair values of the non-current assets

 

in Company 123 were £1000 above their book value as shown below. The

 

statements of financial position of each company on the December 31, 20X1 were as

 

follows (all figures in £?000):

 

Company X

 

ASSETS

 

Non-current assets

 

Goodwill Company 123 £ Group £ 30,000 £ 14,000 -- ? -- ? Investment in 123 18,000 -- -- Net current assets 12,000 7,000 ? Total assets 60,000 21,000 ? Share capital 34,000 15,000 ? Retained earnings 26,000 6,000 ? Non-controlling interest -60,000 -21,000 ?

 

? Required:

 

Prepare the statement of financial position for the group as of December 31,

 

20X1. This will require that you compute the goodwill, the non-controlling

 

interest, assets/liabilities, and consolidated share capital and reserves. Your

 

completed statement of financial position should include the amounts of each

 

separate organisation, with a third column for the group (essentially filling in the question marks in the above statement of financial position). You should

 

also provide supporting notes to the statement of financial position that

 

document your calculations.

 

Part 2

 

You are given information for two organisations, Acme plc and Generic plc. Acme plc

 

had acquired 80% of the common shares of Generic plc on December 31, 20X8. The

 

individual income statements for each organisation on December 31, 20X9 were as

 

follows (all figure in £?000):

 

Acme plc

 

£ Generic plc

 

£ Group

 

£ Sales 100,000 60,000 ? Cost of goods sold 30,000 30,000 ? Gross profit 70,000 30,000 ? Expenses 29,541 20,000 ? Impairment of goodwill - Profits from operations 40,459 Dividends received 3,200 Profit before tax 43,659 10,000

 

- ?

 

?

 

? 10,000 ? Income tax expense 7,002 3,000 ? Net profit 36,657 7,000 ? Apportionment of profit

 

Ordinary shareholders in Acme ? Non-controlling interest in Generic plc

 

?

 

Total ? Additional information: During the year 20X9, Acme plc sold Generic plc goods at a cost of £5000

 

plus 20% mark-up. Generic had 50% of these goods still in stock at the end of

 

the year. £1,500 of goodwill is to be written off as an impairment loss. Generic plc issued £4,000 worth of dividends on common stock. Required:

 

Prepare an income statement (in the same format provided in the text) for the

 

group for the year ended December 31, 20X9. The income statement should

 

show the items for each organisation separately with a third column for the

 

group. You should also have supporting notes to the income statement that

 

document your calculations.

 

Use the Turnitin link below to submit your Assignment by Day 7.

 


Solution details:

Pay using PayPal (No PayPal account Required) or your credit card . All your purchases are securely protected by .
SiteLock

About this Question

STATUS

Answered

QUALITY

Approved

DATE ANSWERED

Sep 13, 2020

EXPERT

Tutor

ANSWER RATING

GET INSTANT HELP/h4>

We have top-notch tutors who can do your essay/homework for you at a reasonable cost and then you can simply use that essay as a template to build your own arguments.

You can also use these solutions:

  • As a reference for in-depth understanding of the subject.
  • As a source of ideas / reasoning for your own research (if properly referenced)
  • For editing and paraphrasing (check your institution's definition of plagiarism and recommended paraphrase).
This we believe is a better way of understanding a problem and makes use of the efficiency of time of the student.

NEW ASSIGNMENT HELP?

Order New Solution. Quick Turnaround

Click on the button below in order to Order for a New, Original and High-Quality Essay Solutions. New orders are original solutions and precise to your writing instruction requirements. Place a New Order using the button below.

WE GUARANTEE, THAT YOUR PAPER WILL BE WRITTEN FROM SCRATCH AND WITHIN A DEADLINE.

Order Now