Prepare an acquisition analysis at july

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Question - On 1 July 2019, Allenby Ltd acquired all the shares of Gardens Ltd on a cum-div. basis for $142,200 cash. At this date, the equity and liability sections of Gardens Ltd's statement of financial position showed the following balances: Share capital (60,000 sh­ares) $60,000, General reserve $30,000, Retained earnings $21,000, Dividend payable $5,000.

At acquisition date, all the identifiable assets and liabilities of Gardens Ltd were recorded at amounts equal to fair value except for:

 

Carrying Amount

Fair Value

Inventories

$50,000

$56,000

Equipment (cost $30,000)

24,000

32,000

Machinery (cost $17,000)

15,000

16,000

Land

18,480

24,480

Required - Prepare an acquisition analysis at 1 July 2019.

Reference no: EM133038907

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