EXAMINATION SUBMIT - Overall assessment - Ngoc Bich Hong Vu 00857442 10.0.

00
Candidate name : Ngoc Bich Hong Vu
EXAMINATION SUBMIT
Time Taken
Adjustment Type

No

Candidate ID00857442
65
Minutes

Reqd. Entered

Correct

Errors

11

Revalue assets acquired to fair value

12

Account for difference on consolidation

13

Write down / Write off difference on consolidation

15

Eliminate double-counting of net assets

21

Eliminate intragroup sales of merchandise

22a

Eliminate unrealised profit in closing stock

23a

Eliminate unrealised profit in opening stock

24

Eliminate intragroup trade debt

31a

Non-current asset transfer - reverse profit/loss

31c

Non-current asset transfer - adjust depreciation

32a

Capitalised stock transfer - reverse profit/loss

32c

Capitalised stock transfer - adjust depreciation

41

Eliminate intragroup debentures

42

Eliminate intragroup debenture interest

43

Eliminate intragroup debenture interest owing

44

Eliminate intragroup loans

45

Eliminate intragroup loan interest

46

Eliminate intragroup loan interest owing

47

Account for cash in transit

52

Eliminate post-acquisition interim dividends paid

54

Eliminate post-acquisition final dividend declared

55

Eliminate final dividend owing

61

Eliminate intragroup service fees

62

Eliminate intragroup service fees owing

63

Eliminate intragroup rental fees

64

Eliminate intragroup rental fees owing

71

Account for NCI (share capital)

72

Account for NCI (reserves)

73

Account for NCI (retained earnings)

Totals

70

69

60

ASSESSMENT KEY
Correct
Incorrect
Adjustment not needed
Adjustment needed

EXAMINATION SUBMIT - Worksheet (correct postings) Ngoc Bich Hong Vu 00857442 10.0.00
Worksheets as at : 30-Jun-15

P Ltd.

S Ltd

Adj. Dr.

No

Adj. Cr.

Consol

COMPREHENSIVE INCOME
Sales revenue

440,000

180,000

Stock (opening)

506,000

162,000

Purchases

154,000

108,000

72,600

21

9,600 32a
23a

537,800
920

667,080

21

72,600

180,200

32a

9,200

960 22a

Stock (closing)

462,000

162,000

Cost of goods sold

198,000

108,000

224,240

Gross Profit

242,000

72,000

313,560

Total expenses

59,040

19,400

5,040

13

500 31c
32c

Trading profit

182,960

Dividend revenue

15,120

Interest revenue
Other revenue

10,530
4,400

Profit on sale of assets

Operating profit before tax

623,040

65,540
200

42

6,400

45

8,000

63

3,840

52,600

248,020
3,600

52

11,520

54

6,400

42

8,000

45

5,640

3,840

63

3,800

3,800 31a

9,400

0
5,530
6,200
0

213,010

71,440

259,750

Income tax expense

85,200

28,560

113,760

Operating profit after tax

127,810

42,880

Profit attributable to NCI

145,990
3,970

73

3,970

Profit attributable to parent

Retained earnings (opening)

142,020
300,000

313,600

10,800

13

176,400

15

394,160

920 23a
31,320 73
Available for appropriation

427,810

356,480

Interim dividends paid

12,400

4,000

Final dividend declared

38,000

536,180

12,800

52

3,600

73

400

54

11,520

73

1,280

12,400
38,000

Total appropriations

50,400

16,800

50,400

Retained earnings

377,410

339,680

485,780

FINANCIAL POSITION
Credit balances :
Share capital

270,000

140,000

126,000

15

14,000

71
11

Revaluation surplus

General reserve
Capital profits reserve
Retained earnings

216,000
108,000
377,410

18,000
44,000

1,800

15

200

72

16,200

15

1,800

72

39,600

15

4,400

72

270,000
2,000

216,000
108,000

339,680

485,780

NCI (share capital)

71

14,000

14,000

NCI (reserves)

72

6,400

6,400

NCI (retained earnings)

73

33,610

33,610

Accounts payable

15,100

38,200

31,000

24

22,300

Accrued expenses

500

2,770

2,700

43

EXAMINATION SUBMIT - Worksheet (correct postings) Ngoc Bich Hong Vu 00857442 10.0.00
Worksheets as at : 30-Jun-15

P Ltd.

S Ltd

Adj. Dr.

No

250

46

320

64

Adj. Cr.

Consol

Dividends payable

38,000

12,800

11,520

55

39,280

Debentures (8%)

55,000

25,000

80,000

41

13,500

13,500

44

31,500

44

Loan from parent

Loan from subsidiary

31,500

Accumulated dep'n - buildings

14,000

4,600

Accumulated dep'n - motor veh.

6,250

4,025

Accumulated dep'n - other assets

Other credit balances
Total credits
Debit balances :
Cash at bank

4,500

11,730

286,412

60,907

1,422,672

715,212

79,000

81,000

Cash in transit

31a

5,800

31c

500

200 32c
13

15,840

16,575
16,030
363,159
1,609,734

160,000
5,000

47

Accounts receivable

34,600

15,900

24

Inventory

462,000

162,000

22a

2,770

500

Accrued revenue

0
18,600

5,000
31,000

19,500

960

623,040

43

2,700

46

250

64

320

Dividends receivable

12,800

55

11,520

1,280

Debentures

25,000

41

25,000

Debentures in parent

55,000

41

55,000

Loan to parent

35,000

44

31,500

Loan to subsidiary
Shares in subsidiary

15,000
396,000

47

3,500

44

13,500

47

1,500

12

36,000

15

360,000

11

Land

130,000

11,500

Buildings

140,000

46,000

Office furniture & equipment

15,000

39,100

32a

Motor vehicles

25,000

16,100

2,000 31a

Other assets

85,502

253,112

Goodwill on consolidation
Total debits

2,000

715,212

0
143,500
186,000

400

53,700
43,100
338,614

36,000
1,422,672

12

36,000
1,609,734

EXAMINATION SUBMIT - Additional Information

Ngoc Bich Hong Vu

00857442 10.0.00

The consolidation date for this case study is : 30-Jun-15

On 01-Jul-10, P acquired 90 percent of the share capital and reserves of S for $396,000.
On the date of control, all assets were recorded at fair values with the exception of land. At that time, the land was
estimated to have a fair value of $12,000
On 01-Jul-10 , the abridged financial position data for S were as follows :
Cash at bank
Accounts receivable
Inventory
Office furniture & equipment
Motor vehicles
Land
Buildings

301,000
18,000
32,000
34,000
14,000
10,000
40,000
------449,000

Accounts payable
Debentures (10%)
Share capital
General reserve
Retained earnings
Capital profits reserve

15,000
36,000
140,000
18,000
196,000
44,000
------449,000

During the year, P sold goods to S for $52,800 at a mark-up of 20 percent on cost. 10 percent of these goods are still
on hand at the date of consolidation. Total intragroup sales of merchandise for the year : S to P $19,800 .
Included in the trade debtors of P is $22,000 owed by S. Also, included in the trade creditors of P is $9,000 owing to S.
Closing stock of P contained goods purchased from S for $880. S marks up merchandise by 10 percent.
Opening stock of S contained goods purchased from P for $3,120. P marks up merchandise by 20 percent. Opening
stock of P contained goods purchased from S for $990. Cost to S was $590.
On the 01-Jul-14, S sold a delivery vehicle to P for $21,200. The vehicle had been purchased by S for $23,200 and at
the time of sale had a written down value of $17,400. Both P and S depreciate delivery vehicles at 25 percent on cost.
On the 01-Jul-14, S sold goods (cost $9,200) to P for $9,600. P used these goods as Office furniture & equipment, with
a useful life of 2 years, and a residual value of $1,000. P uses the straight line method of depreciation. Note: this
intragroup sale is not included elsewhere in the problem data.
P holds $25,000 debentures in S purchased 13 months ago. P receives debenture interest quarterly - on 30th
September, 31st December, 31st March and the 30th June. S purchased debentures in P 7 months ago. S receives
debenture interest twice each year - on 31st December and 30th June. Interest cheques are drawn and posted within
one or two weeks of calculation.
Intragroup loan interest levied by P during the year totalled $3,000. None of this amount remained outstanding as at
consolidation date. Intragroup loan interest levied by S during the year totalled $5,000. Of this amount 5 percent
remained outstanding as at consolidation date.
During the year S rented a spare warehouse to P for 12 months, at an agreed rental of $320 per month, payable at the
end of each month. P still owed S 1 month's rental.
All dividends declared by S during the year had been declared out of post-acquisition profits.
Both P and S recognise dividend revenue prior to the receipt of cash.
If this case study involves goodwill on acquisition, you can assume the following:
(a) goodwill on acquisition has been subject to annual impairment testing
each year that the group entity has been in existence.
(b) For the current year, the goodwill on acquisition impairment test
write-down is 20 percent of the asset's start of year carrying value.
(c) Accumulated impairment losses for goodwill on acquisition prior to the
current year total 30 percent of the asset acquisition date carrying value.
Both P and S depreciate buildings over a useful life of 10 years.
Both P and S adopt the following debenture policy - all debenture assets to be purchased on the secondary market,
and the book value of all debenture assets to reflect face value.
Neither P nor S adopt Tax Effect Accounting.
The group entity adopts the partial goodwill method whereby only goodwill attributable to P is measured.

EXAMINATION SUBMIT - User's Journals Ngoc Bich Hong Vu 00857442 10.0.00

11

REVALUE ASSETS ACQUIRED TO FAIR VALUE

Land

2,000
Revaluation surplus

12

ACCOUNT FOR DIFFERENCE ON CONSOLIDATION

Goodwill on consolidation
Shares in subsidiary

13

920
920

31,000
31,000

2,000
3,800
5,800

500
500

9,600
400
9,200

200
200

ELIMINATE INTRAGROUP DEBENTURES

Debentures (8%)
Debentures

42

960

CAPITALISED STOCK TRANSFER - ADJUST DEPRECIATION

Accumulated dep'n - other assets
Total expenses

41

960

CAPITALISED STOCK TRANSFER - REVERSE PROFIT/LOSS

Sales revenue
Office furniture & equipment
Purchases

32c

72,600

NON-CURRENT ASSET TRANSFER - ADJUST DEPRECIATION

Total expenses
Accumulated dep'n - motor veh.

32a

72,600

NON-CURRENT ASSET TRANSFER - REVERSE PROFIT/LOSS

Motor vehicles
Profit on sale of assets
Accumulated dep'n - motor veh.

31c

360,000

ELIMINATE INTRAGROUP TRADE DEBT

Accounts payable
Accounts receivable

31a

126,000
16,200
176,400
39,600
1,800

ELIMINATE UNREALISED PROFIT IN OPENING STOCK

Retained earnings (opening)
Stock (opening)

24

15,840

ELIMINATE UNREALISED PROFIT IN CLOSING STOCK

Stock (closing)
Inventory

23a

10,800
5,040

ELIMINATE INTRAGROUP SALES OF MERCHANDISE

Sales revenue
Purchases

22a

36,000

ELIMINATE DOUBLE-COUNTING OF NET ASSETS

Share capital
General reserve
Retained earnings (opening)
Capital profits reserve
Revaluation surplus
Shares in subsidiary

21

36,000

WRITE DOWN / WRITE OFF DIFFERENCE ON CONSOLIDATION

Retained earnings (opening)
Total expenses
Other credit balances

15

2,000

ELIMINATE INTRAGROUP DEBENTURE INTEREST

80,000
80,000

EXAMINATION SUBMIT - User's Journals Ngoc Bich Hong Vu 00857442 10.0.00

Interest revenue
Total expenses
43

3,600
3,600

11,520
11,520

11,520
11,520

3,840
3,840

320
320

14,000
14,000

ACCOUNT FOR NCI (RESERVES)

Revaluation surplus
General reserve
Capital profits reserve
NCI (reserves)

73

1,500
3,500

ACCOUNT FOR NCI (SHARE CAPITAL)

Share capital
NCI (share capital)

72

5,000

ELIMINATE INTRAGROUP RENTAL FEES OWING

Accrued expenses
Accrued revenue

71

250

ELIMINATE INTRAGROUP RENTAL FEES

Other revenue
Total expenses

64

250

ELIMINATE FINAL DIVIDEND OWING

Dividends payable
Dividends receivable

63

8,000

ELIMINATE POST-ACQUISITION FINAL DIVIDEND DECLARED

Dividend revenue
Final dividend declared

55

8,000

ELIMINATE POST-ACQUISITION INTERIM DIVIDENDS PAID

Dividend revenue
Interim dividends paid

54

13,500
31,500

ACCOUNT FOR CASH IN TRANSIT

Cash in transit
Loan to subsidiary
Loan to parent

52

13,500
31,500

ELIMINATE INTRAGROUP LOAN INTEREST OWING

Accrued expenses
Accounts receivable

47

3,375

ELIMINATE INTRAGROUP LOAN INTEREST

Interest revenue
Total expenses

46

3,375

ELIMINATE INTRAGROUP LOANS

Loan from parent
Loan from subsidiary
Loan to subsidiary
Loan to parent

45

8,000

ELIMINATE INTRAGROUP DEBENTURE INTEREST OWING

Accrued expenses
Accrued revenue

44

8,000

200
1,800
4,400
6,400

ACCOUNT FOR NCI (RETAINED EARNINGS)

Retained earnings (opening)
Profit attributable to NCI
Interim dividends paid

31,272
4,108
400

EXAMINATION SUBMIT - User's Journals Ngoc Bich Hong Vu 00857442 10.0.00

Final dividend declared
NCI (reserves)

1,280
33,700

EXAMINATION SUBMIT - Correct Journals Ngoc Bich Hong Vu 00857442 10.0.00

11

REVALUE ASSETS ACQUIRED TO FAIR VALUE

Land

2,000
Revaluation surplus

12

ACCOUNT FOR DIFFERENCE ON CONSOLIDATION

Goodwill on consolidation
Shares in subsidiary

13

960

920
920

31,000
31,000

2,000
3,800
5,800

500
500

9,600
400
9,200

CAPITALISED STOCK TRANSFER - ADJUST DEPRECIATION

Accumulated dep'n - other assets
Total expenses

41

960

CAPITALISED STOCK TRANSFER - REVERSE PROFIT/LOSS

Sales revenue
Office furniture & equipment
Purchases

32c

72,600

NON-CURRENT ASSET TRANSFER - ADJUST DEPRECIATION

Total expenses
Accumulated dep'n - motor veh.

32a

72,600

NON-CURRENT ASSET TRANSFER - REVERSE PROFIT/LOSS

Motor vehicles
Profit on sale of assets
Accumulated dep'n - motor veh.

31c

360,000

ELIMINATE INTRAGROUP TRADE DEBT

Accounts payable
Accounts receivable

31a

126,000
1,800
16,200
176,400
39,600

ELIMINATE UNREALISED PROFIT IN OPENING STOCK

Retained earnings (opening)
Stock (opening)

24

15,840

ELIMINATE UNREALISED PROFIT IN CLOSING STOCK

Stock (closing)
Inventory

23a

10,800
5,040

ELIMINATE INTRAGROUP SALES OF MERCHANDISE

Sales revenue
Purchases

22a

36,000

ELIMINATE DOUBLE-COUNTING OF NET ASSETS

Share capital
Revaluation surplus
General reserve
Retained earnings (opening)
Capital profits reserve
Shares in subsidiary

21

36,000

WRITE DOWN / WRITE OFF DIFFERENCE ON CONSOLIDATION

Retained earnings (opening)
Total expenses
Other credit balances

15

2,000

200
200

ELIMINATE INTRAGROUP DEBENTURES

Debentures (8%)
Debentures in parent
Debentures

80,000
55,000
25,000

EXAMINATION SUBMIT - Correct Journals Ngoc Bich Hong Vu 00857442 10.0.00

42
ELIMINATE INTRAGROUP DEBENTURE INTEREST
Interest revenue
Total expenses
43

1,500
3,500

3,600
3,600

11,520
11,520

11,520
11,520

3,840
3,840

320
320

14,000
14,000

ACCOUNT FOR NCI (RESERVES)

Revaluation surplus
General reserve
Capital profits reserve
NCI (reserves)

73

5,000

ACCOUNT FOR NCI (SHARE CAPITAL)

Share capital
NCI (share capital)

72

250

ELIMINATE INTRAGROUP RENTAL FEES OWING

Accrued expenses
Accrued revenue

71

250

ELIMINATE INTRAGROUP RENTAL FEES

Other revenue
Total expenses

64

8,000

ELIMINATE FINAL DIVIDEND OWING

Dividends payable
Dividends receivable

63

8,000

ELIMINATE POST-ACQUISITION FINAL DIVIDEND DECLARED

Dividend revenue
Final dividend declared

55

31,500

ELIMINATE POST-ACQUISITION INTERIM DIVIDENDS PAID

Dividend revenue
Interim dividends paid

54

13,500
31,500

ACCOUNT FOR CASH IN TRANSIT

Cash in transit
Loan to subsidiary
Loan to parent

52

13,500

ELIMINATE INTRAGROUP LOAN INTEREST OWING

Accrued expenses
Accrued revenue

47

2,700

ELIMINATE INTRAGROUP LOAN INTEREST

Interest revenue
Total expenses

46

2,700

ELIMINATE INTRAGROUP LOANS

Loan from parent
Loan to subsidiary
Loan from subsidiary
Loan to parent

45

6,400

ELIMINATE INTRAGROUP DEBENTURE INTEREST OWING

Accrued expenses
Accrued revenue

44

6,400

200
1,800
4,400
6,400

ACCOUNT FOR NCI (RETAINED EARNINGS)

Retained earnings (opening)
Profit attributable to NCI

31,320
3,970

EXAMINATION SUBMIT - Correct Journals Ngoc Bich Hong Vu 00857442 10.0.00

Interim dividends paid
Final dividend declared
NCI (retained earnings)

400
1,280
33,610