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April 18, 2020 at 11:57 pm #568709Effes
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You are provided with the following statements of financial position for SanLtd and
Stay Ltd as at 31st May 2019.
Property, Plant &Equipment 650,000 140,000
Investment Property 400,000 100,000
Investment in share in Stayhome 400,000
Net Current Assets
Inventory at cost 440,000 140,000
Receivables 290,000 100,000
Cash and cash equivalents 200,000 – Payables (550,000) (110,000) Bank overdraft 0 (40,000)
Net Assets 1,830,000 440,000
Stated Capital: Equity shares issued at GH¢1.00 each 1,400,000 340,000
Income surplus 430,000 100,000
The following information is also available:
1. San purchased 70% of the issued equity share capital of Stay on 1st June 2015 when the income surplus of Stay was GH¢40,000. There has been no impairment of goodwill
2. For the purpose of the acquisition, plant in Stay with book value of GH¢l00.000 was revalued to its fair value of GH¢l20,000. The revaluation was not recorded in the accounts of Stay. Depreciation is charged at 20% using the straight-line method.
3. San sells goods to Stay at a margin of 20%. At 31st May 2019, the inventories of Stayhome included GH¢90.000 of goods purchased from San.
4. Stay owes San GH¢70,000 for goods purchased and Sanitizer owes Stayhome
5. It is the group’s policy to value the non-controlling interest at full fair value.
6. The market price of the shares of non-controlling shareholders just before the acquisition was GH¢l.50.
You are required to prepare the consolidated Statement of Financial Position of San as at 31st May 2019.April 19, 2020 at 7:50 pm #568783P2-D2Keymaster
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I don’t answer full questions as it doesn’t help anyone, sorry. If you let me know where you are struggling then I will gladly help you out.
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