FAC3704 Assignment 2 Semester 1 2022

FAC3704 ASSIGNMENT 2 – SEMESTER 2 OF
2022
1. 2

Calculation of Opening Retained Earnings for the year ended 31 March 2022

R
Retained Earnings – Big Bang Ltd (1 April 2016) 209 060
Retained Earnings – Sheldon Ltd (calculation 1) 91 592
Share of Profit - Howard Ltd (calculation 3 – 133 744 + 23 000) 156 744
Retained Earnings – 1 April 2016 457 396


2. 4

Calculation of Property, Plant & Equipment – 31 March 2022

R
Big Bang Ltd 330 000
Sheldon Ltd 210 000
Profit on intragroup sale of equipment (34 000 – 30 000) (4 000)
Depreciation on intragroup sales (4 * ) 1 500
Property, Plant & Equipment – 31 March 2022 537 500


3. 5

Calculation of Other Income – 31 March 2022

R
Big Bang Ltd 150 500
Sheldon Ltd 88 600
Profit on intragroup sale of equipment (34 000 – 30 000) (4 000)
Ordinary dividend – Sheldon (10 000 * 80%) (8 000)
Ordinary dividend – Leonard (10 000 * 30%) (3 000)
Ordinary dividend – Howard (60 000 * 35%) (21 000)
Other Income – 31 March 2022 203 100

, 3. Big Bang Ltd.’s percentage shareholding in Howard Ltd = 175 000 * 100
500 000

= 35%

Analysis of Shareholders Equity of Howard Ltd

Total Big Bang Ltd (35%) Carrying
Amount
At Since
At Acquisition R R R R
Share Capital 800 000 280 000
Retained Earnings 643 774 225 321
1 443 774 505 321
Investment in Howard (482 321) 482 321
Excess of fair value over cost 23 000

Since Acquisition
To beginning of current year
Retained Earnings (1 025 900 – 643 774) 382 126 133 744 133 744
Excess of fair value over cost 23 000 23 000


Current Year
Profit for the year 882 889 309 011 309 011
Unrealised profit in closing inventory (20 000 *
20% * 72%) (2 880) (2 880) -
Ordinary dividend (60 000) (21 000) (21 000)
2 645 909 441 875 927 076