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(Solved by Expert Tutors) The summarized statements of financial position of Close and Steele as a


follows:

???????????????????????????????????????????????????????????????????????????????????????????????Close????????????????????????????????????????????????????Steele

???????????????????????????????????????????????????????????????????????????????????????????????$?????????????????????????????????????????????????????????????$

Assets??????????????????????????????????

Non-current assets

Tangible assets????????????????????????????????????????????????????????????????84,000??????????????????????????????????????????????????58,200

Investments?????????????????????????????????????????????????????????????????????80,000

Current assets

Current accounts - Close?????????????????????????????????????????????????????????????????????????????????????????????????????????????3,200

Cash at bank?????????????????????????????????????????????????????????????????????10,000??????????????????????????????????????????????????3,000

Investments?????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????2,500

Trade receivables???????????????????????????????????????????????????????????62,700??????????????????????????????????????????????????21,100

Inventory???????????????????????????????????????????????????????????????????????????18,000??????????????????????????????????????????????????12,000

??????????????????????????????????????????????????????????????????????????????????????????254,700???????????????????? ??????????? 100,000

Equity and Liabilities

Trade payables????????????????????????????????????????????????????????????????35,000??????????????????????????????????????????????????11,000

Current account - Steele???????????????????????????????????????????? ?2,700????????????????????????????????????????????????????-

Called up share capital ($1 ordinary shares)??????? ? 120,000????????????????????????????? ?? 60,000

Share premium account???????????????????????????????????????????????????18,000

Revaluation surplus on January 1, 2012???????? ???????? 23,000??????????????????????????????????????????????????16,000

Retained earnings on January 1, 2012??????????????? ??? 40,000??????????????????????????????????????????????????8,000

Profit for 2012??????????????????????????????????????????????????????????????????16,000??????????????????????????????????????????????????5,000

????????????????????????????????????????????????????????????????????????????????????????254,700????????????????????????? ????? 100,000

Additional information

(1)???On December 31, 2011, Close acquired 48,000 shares in Steele for $80,000 cash.

(2)???The inventory of Close includes $4,000 goods from Steele invoiced to Close at cost plus 25%.

(3)???A payment for $500 by Close to Steele, sent before December 31, 2012, was not received by ?Steel until January 2013.

(4)???Goodwill has been impaired by $7,800 since the acquisition took place.

(5)???Non-controlling interest is valued at the proportionate share of the subsidiary's identifiable net assets; it is not credited with its share of goodwill.

Required:

Prepare the consolidated statement of financial position of Close and its subsidiary Steele as at December 31, 2012.

 


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Apr 19, 2020

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