Berry Ltd acquired 70% of the shares of James Ltd on 1st July 2016 for $540,000. The James Ltd equity consisted of the following items at acquisition date


Share Capital                                                    $500,000

General Reserve                                                   80,000

Retained Earnings                                                 50,000

Asset revaluation reserve                                         20,000


All identifiable assets and liabilities of James Ltd are recorded at fair value at this date except for inventory for which the fair value was $10,000 greater than carrying amount and plant which had a carrying amount of $150,000 (Accumulated depreciation net of $40,000) and a fair value was $170,000. The plant has a further 5 years life.

The Financial information for both companies at 30 June 2020 is as follows:

Berry Ltd                          James Ltd

Sales Revenue                                                              $720,000                           $530,000

Other revenue                                                                 240,000                             120,000

Cost of Sales                                                                (610,000)                          (410,000)

Other expenses                                                             (230,000)                          (160,000)

Profit before tax                                                             $120,000                             $80,000

Tax expense                                                                   (40,000)                            (25,000)

Profit for the period                                                          $80,000                             $55,000

R/E at 1/07/19                                                                 200,000                             112,000

Dividend Paid                                                                  (20,000)                            (10,000)

Dividend declared                                                            (25,000)                            (15,000)

R/E at 30/06/20                                                             $235,000                           $142,000

Share capital                                                                   600,000                             500,000

Asset revaluation reserve                                                   20,000                               60,000

General reserve                                                                80,000                             100,000

Total equity                                                                   $935,000                           $802,000

Dividend payable                                                               25,000                               15,000

Other Liabilities                                                                 25,000                               25,000

Total Liabilities                                                                  50,000                               40,000

Total Equity and Liabilities                                              $985,000                           $842,000

Receivables                                                                      80,000                                30,000

Inventory                                                                         100,000                                 170,000

Plant and Equipment                                                         200,000                             500,000

Acc Depreciation                                                           (115,000)                            (88,000)

Land                                                                               100,000                               80,000

Share in James Ltd                                                          540,000                                         –

Deferred Tax assets                                                         50,000                                 40,000

Other assets                                                                   $30,000                            $110,000

Total Assets                                                                     $985,000                         $842,000


Other Information


  1. The management of Berry ltd values any non-controlling interest in James Ltd at fair value.
  2. During the current financial year James Ltd sold inventory to Berry Ltd for 23,000, recording a profit before tax of $3000. Fifty percent of this inventory is still on hand with Berry Ltd.
  3. During the 2019-2020 period, Berry Ltd sold inventory to James Ltd for $18,000. The inventory cost Berry $16,000 to produce. James Ltd has not sold any of these items.
  4. During the current financial year James ltd paid 1000 to Berry Ltd for services rendered
  5. During the 2018-19 period, James ltd sold inventory to Berry Ltd. At 30 June 2019, Berry Ltd still had inventory on hand on which James Ltd had recorded a before tax profit 0f $4,000.
  6. On 1 July 2018, James ltd sold plant to Berry ltd for $150,000, recording a profit of 20,000 before tax. Berry Ltd applies 10% p.a straight-line method of depreciation in relation to these assets.
  7. The balance of the reserve at 1 July 2019 were $35000 for Berry Ltd and $50000 for James Ltd.
  8. The tax rate is 30%.


  1. Prepare the consolidated Worksheet Journal entries for 30 June 2020.
  2. Prepare the consolidated Worksheet for 30 June 2020.
  3. Prepare the consolidated financial statements of Berry Ltd and its controlled entity for the reporting period ending 30 June 2020. [Hints: Consolidated Statement of Comprehensive Income; Consolidated Statement of Financial Position; Consolidated Statement of Changes in Equity]

Click on Buy Solution and make payment. All prices shown above are in USD. Payment supported in all currencies. Price shown above includes the solution of all questions mentioned on this page. Please note that our prices are fixed (do not bargain).

After making payment, solution is available instantly.Solution is available either in Word or Excel format unless otherwise specified.

If your question is slightly different from the above question, please contact us at with your version of question.