Set out below are the financial statements of Ant Co., its subsidiary Bug Co. and an associated company Nit Co. for the accounting year-end 31 December 20X9.
Statements of financial position as at 31 December 20X9
|
Ant |
Bug |
Nit |
|
|
$ |
$ |
$ |
|
|
ASSETS |
|||
|
Non-cur rent assets |
|||
|
Property, plant and equipment at cost |
240,000 |
135,000 |
75,000 |
|
Depreciation |
150,000 |
52,500 |
15,750 |
|
90,000 |
82,500 |
59,250 |
|
|
Investment in Bug |
90,000 |
||
|
Investment in Nit |
30,000 |
||
|
Current assets |
|||
|
Inventories |
105,000 |
45,000 |
27,000 |
|
Trade receivables |
98,250 |
52,500 |
27,000 |
|
Current account – Bug |
11,250 |
||
|
Current account – Nit |
2,250 |
||
|
Bank |
17,250 |
5,250 |
4,500 |
|
Total current assets |
234,000 |
102,750 |
58,500 |
|
Total assets |
444,000 |
185,250 |
117,750 |
|
EQUITY AND LIABILITIES |
|||
|
$1 ordinary shares |
187,500 |
45,000 |
37,500 |
|
General reserve |
22,500 |
15,000 |
9,000 |
|
Retained earnings |
112,500 |
90,000 |
37,500 |
|
322,500 |
150,000 |
84,000 |
|
|
Current liabilities |
|||
|
Trade payables |
99,000 |
18,750 |
25,500 |
|
Taxation payable |
22,500 |
5,250 |
6,000 |
|
Current account – Ant |
11,250 |
2,250 |
|
|
Total equity and liabilities |
444,000 |
185,250 |
117,750 |
Statements of comprehensive income for the year ended 31 December 20X9
|
$ |
$ |
$ |
|
|
Sales |
225,000 |
120,000 |
75,000 |
|
Cost of sales |
67,500 |
60,000 |
30,000 |
|
Gross profit |
157,500 |
60,000 |
45,000 |
|
Expenses |
70,500 |
37,500 |
30,000 |
|
Dividends received |
7,500 |
NIL |
7,500 |
|
Profit before tax |
94,500 |
22,500 |
22,500 |
|
Taxation |
22,500 |
5,250 |
6,000 |
|
Profit for the year |
72,000 |
17,250 |
16,500 |
|
Dividends paid in year |
30,000 |
7,500 |
6,000 |
Ant Co. acquired 80% of the shares in Bug Co. on 1 January 20X7 when the balance on the retained earnings of Bug Co. was $45,000 and the balance on the general reserve of Bug Co. was $12,000. The fair value of the non-controlling interest in Bug on 1 January 20X7 was £21,000. Group policy is to measure non-controlling interests using method 2. Ant Co. also acquired 25% of the shares in Nit Co. on 1 January 20X8 when the balance on Nit’s retained earnings was $22,500 and the general reserve $6,000.
During the year Ant Co. sold Bug Co. goods for $12,000, which included a mark-up of one-third. 90% of these goods were still in inventor y at the end of the year.
Required:
(a) Prepare a consolidated statement of comprehensive income for the year ending 31/12/20X9, including the associated company Nit’s results.
(b) Prepare a consolidated statement of financial position at 31/12/20X9, including the associated company.