Text Book Pg 372 8B2

Balance Sheet as on 31.3.20xx

Non
controlling
Particulars S.Co K.Co Additions Deletions Interest
Equity and Liabilities
Shareholders’ funds
Share capital 50000 15000 15000
Reserves and surplus
27000 3000 3000
Non-current liabilities
Bonds payable 22000 12000
Current liabilities
Trade payables 19000 7000 1000 2000
Total 118000 37000
Assets
Non-current assets Fixed assets

Property, plant and equipment:

Cost 100000 60000 20000

Less Accumulated depreciation

(70000) (45000) 15000
Net 30000 15000 5000
Investments in K.Co 60000 0 60000
Current assets
Inventories 12000 9000 2000
Trade receivables 14000 10000 2000
Cash 2000 3000
Goodwill 40000
Total 118000 37000

Steps involved in preparing consolidated Balance Sheet

1. Eliminate common transactions
2. Eliminate the investments of the investor in investee Co
3. Adjust the assets and Liabilities t the fair value
4. Calculate the Goodwill/capital reserve
5. Calulate the Non controlling interest

Working for fair value of K.Co

Net Assets
Less Inventories
Trade
receivables
Cash

Trade Payable
Bonds
Net
Identifiable
assets
 Consolidated
Balance Sheet Journal Entries in S.Co Dr Cr

50000

27000

34000

25000
136000

180000

130000
50000
0 1 Investment in K.Co A/C Dr 60000
To,Cash 60000
19000
22000 2 Share capital of K.CoA/C Dr 15000
5000 Retained Earnings K.CoA/C Dr 3000
40000 To, Investments in K.Co 18000
136000
3 Plant P &E A/C Dr 5000
Goodwill A/C Dr (Bal No) 40000
To, Inventory A/C 2000
To,Trade Payable A/C 1000
To, Investment in K.Co 42000
To,Non Controlling interest A/C 0

4 Trade Payables A/C Dr 2000

To Trade Receivables 2000

ing for fair value of K.Co

15000 5000 20000
9000 -2000 7000

10000 10000
 3000 3000
7000 1000 (8000)
12000 (12000)
20000
Text Book Pg 372 8B3
Balance Sheet as on 31.3.20xx
Non
controlling
Particulars A.Co P.Co Additions Deletions Interest
Equity and Liabilities
Shareholders’ funds
Share capital 100000 30000 24000 6000
Reserves and surplus 64000 10000 8000 2000
Non controlling Interest fair value adj 800
Non-current liabilities
Bonds payable 150000 40000 8000
Current liabilities
Trade payables 68000 18000 2000
Total 382000 98000
Assets
Non-current assets Fixed assets

Property, plant and equipment:

Cost 250000 90000 22500

Less Accumulated depreciation

(11000) (54000) 13500
Net 140000 36000 9000
Investments in P.co 48000 48000
Non Current Investments 18000 4000 8000
Current assets
Inventories 47000 12000 3000
Trade receivables 29000 31000
Cash 100000 15000
Goodwill 12800
Total 382000 98000

Steps involved in preparing consolidated Balance Sheet

1. Eliminate the investments of the investor in investee Co
2. Eliminate common transactions
3. Adjust the assets and Liabilities t the fair value
4. Calculate the Goodwill/capital reserve
5. Calulate the Non controlling interest

Working for fair value of P.Co

Net Assets 36000
Inventories 12000
Investments 4000
Trade
receivables 31000
 Cash 15000

Trade Payable
Less 18000
Bonds 40000
Net
Identifiable
assets
A.Co Share of
80%
Consideration
Goodwill
Consolidated
Balance Sheet Journal Entries in A.Co Dr Cr

100000
64000
8800

182000

88000
442800

362500

177500
185000
0
14000 Investment inP.Co A/C Dr 48000
To,Cash 48000
56000
60000 Share capital A/C Dr 30000
115000 Retained Earnings A/C Dr 10000
12800 To, Investments in P.Co 40000
442800
Plant P &E A/C Dr 9000
Bonds A/c 8000
Goodwill A/C 12800
To, Inventory A/C 3000
To,Trade Payable A/C 2000
To, Investment in P.Co 8000
To, Bonds 8000
To,Non Controlling interest A/C( Bal fig) 8800

9000 45000 Non Controlling

-3000 9000 Equity 6000
4000 Reserves 2000

31000 Fairvalue 800

 15000 Total 8800

2000 (20000)
(40000)

44000

35200
48000
12800