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The following are the condensed statements of financial position of Tom Ltd and its subsidiary Jerry Ltd as at 31 December 2020, the date on which Tom Ltd obtained its interest in Jerry Ltd: Tom Ltd Jerry Ltd ASSETS R R Property, plant and equipment 70,000 50,000 Investment: Jerry Ltd (30 000 ordinary shares at cost) 42 000 Trade receivables 20,000 15,000 132,000 65,000 EQUITY AND LIABILITIES Share capital (100 000 & 50 000 shares respectively) 100,000 50,000 Retained earnings 32,000 15,000 132,000 65,000 Additional information: Assume that the identifiable assets acquired, and the liabilities assumed at acquisition date are shown at their acquisition date fair values, as determined in terms of IFRS 3
The following are the condensed statements of financial position of Tom Ltd and its subsidiary Jerry Ltd as at 31 December 2020, the date on which Tom Ltd obtained its interest in Jerry Ltd:
|
|
Tom Ltd |
Jerry Ltd |
|
ASSETS |
R |
R |
|
Property, plant and equipment |
70,000 |
50,000 |
|
Investment: Jerry Ltd (30 000 ordinary shares at cost) |
42 000 |
|
|
Trade receivables |
20,000 |
15,000 |
|
|
132,000 |
65,000 |
|
EQUITY AND LIABILITIES |
|
|
|
Share capital (100 000 & 50 000 shares respectively) |
100,000 |
50,000 |
|
Retained earnings |
32,000 |
15,000 |
|
|
132,000 |
65,000 |
Additional information:
Assume that the identifiable assets acquired, and the liabilities assumed at acquisition date are shown at their acquisition date fair values, as determined in terms of IFRS 3. Tom Ltd elected to measure the non-controlling interests in Jerry Ltd at its fair value of R30 000 at the acquisition date.
REQUIRED:
1. Prepare the at acquisition pro-forma consolidation journal entries in respect of the investment in Jerry Ltd for the Group for the year ended 31 December 2020.
2. Prepare the consolidated statement of financial position of Tom Ltd and its subsidiary as at 31 December 2020. Notes are not required. Assume that the non-controlling interest is shown at its fair value of R30 000.
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