Calculate the non-controlling interest in G Ltd

Reference no: EM132635525

Question - The following are financial statements of H Ltd and its subsidiary G Ltd for the year ending 30 June 2019. The following are in 000 (thousands of dollars).

Other Information:

H Ltd acquired its 80% interest in G Ltd on 1 July 2010, 9 years earlier. At that date capital and reserves of G Ltd were:

Share capital $200,000

Retained earnings $170,000

$370,000

At the date of acquisition all assets were considered to be fairly valued.

-The management of H Ltd values any NCI at the proportionate share of G Ltd's identifiable net assets.

-During the year, H Ltd made total sales to G Ltd of $65,000, while G Ltd sold $52,000 in inventory to H Ltd.

-The opening inventory in H Ltd as at 1 July 2018 included inventory acquired from G Ltd for $42,000 that had cost G Ltd $35,000 to produce.

-The closing inventory in H Ltd includes inventory acquired from G Ltd at a cost of $33,600. This cost G Ltd $28,000 to produce.

-The closing inventory of G Ltd includes inventory acquired from H Ltd at a cost of $12,000. This cost H Ltd $9,600 to produce.

-The management of H Ltd believed that goodwill acquired was impaired by $3,000 in the current financial year. Previous impairments of goodwill amounted to $22,500.

-On 1 July 2018 H Ltd sold an item of plant to G Ltd for $116,000 when its carrying value in H Ltd's account was $81,000 (cost $135,000, accumulated depreciation of $54,000). This plant is assessed as having a remaining useful life of 6 years.

-G Ltd paid $26,500 in management fees to H Ltd.

-The tax rate is 30%.

Required -

1) Prepare the intragroup transaction entries based on the financial statements and other information.

2) Calculate the non-controlling interest in G Ltd.

Reference no: EM132635525

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