Advanced Financial Accounting

Required :
1.Prepare Consolidation Journal entries for the Consolidation of Jan Ltd and Dean Ltd
2.Prepare a Consolidated Comprehensive Income Statement for the Group
3.Prepare a Consolidated Balance Sheet for the Group

Information:
On 1 July 2018 Jan Ltd acquired all the share capital of Dean Ltd for $187,500 .At that date the equity of Jan Ltd and Dean Ltd was :
Jan Ltd        Dean Ltd
Share Capital                                                         $150,000     $100,000
General Reserve                                                       90,000          60,000
Retained Earnings                                                    20,000          17,500
At 1 July 2018 the identifiable net assets of both companies were recorded at fair value.
For the year ended 30 June 2019 the following financial information is provided by both companies:
Jan Ltd            Dean Ltd
Sales revenue                                                                               $388,500           $200,000
Dividend revenue                                                                               7,500             ——
Other revenue                                                                                  10,000             ——-
Total revenue                                                                                 406,000            200,000
Total expenses                                                                              (360,000)          (176,000)
Profit before income tax                                                                 46,000              24,000
Income tax expense                                                                       (15,000)           (10,000)
Profit                                                                                                  31,000              14,000
Retained Earnings 1/7/18                                                              20,000               17,500
Total available for appropriation                                                  51,000               31,500
Interim dividend paid                                                                      (7,500)              (2,500)
Final dividend declared                                                                 (15,000)              (5,000)
(22,500)               (7,500)
Retained Earnings 30/6/19                                                           28,500                 24,000
Shares in Dean Ltd                                                                         187,500               ——-
Other investments                                                                         150,000               ——-
Dividend receivable                                                                            5,000              ——–
Loan receivable                                                                                   5,000             ———
Property,plant and equipment                                                      18,500             205,000
Total assets                                                                                      366,000            205,000
Final dividend payable                                                                     15,000                 5,000
Loan payable                                                                                         ——                  5,000
Other non current liabilities                                                           82,500                11,000
Total liabilities                                                                                  97,500                21,000
Net assets                                                                                        268,500              184,000
Share capital                                                                                   150,000               100,000
General reserve                                                                                90,000                 60,000
Retained Earnings                                                                            28,500                 24,000
Total equity                                                                                     268,500               184,000

Additional information:
1.Jan Ltd has lent $5,000 to Dean Ltd at 1/7/18.This loan has a 10% interest rate
2.Jan Ltd rented office space to Dean Ltd for $4,000 during the year .
3.Jan Ltd sold inventory to Dean Ltd for $25,000 at cost plus 25%.None of this inventory is still
on hand as it has all been sold externally.

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