Solution-Prepare the consolidated statement of financial

Prepare the consolidated statement of financial position

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Reference no: EM133108492

Question - The followings are the financial information of Parent and Daughter pre-acquisition date.

	Parent Ltd £	Daughter Ltd £
Cash	20,000	20,000
Other net assets	25,000	8,800
Net assets	45,000	10,800
Ordinary shares of £1 each	40,500	9,000
Retained earnings	4,500	1,800
Total equity	45,000	10,800

On 1 January 20XX Parent Ltd acquired all the ordinary shares in Daughter Ltd for £10,800 cash. The fair value of the net assets in Daughter Ltd was their book value.

Required -

a) Prepare the statement of financial position of Parent Ltd reflecting the acquisition of Daughter Ltd as at 1 January 20XX.

b) Prepare the consolidated statement of financial position of Parent Ltd at 31st December 20XX.

Reference no: EM133108492

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Prepare the consolidated statement of financial position

Reference no: EM133108492

Reference no: EM133108492

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