Workings :

Step-1 (Group structure)

Investment in S = ___ % consolidate At acquisition date = _____________ At reporting date = _____________

Investment in A = ___ % equity account At acquisition date = _____________ At reporting date = _____________

Step-2 Net asset in S

At acquisition At reporting date date $ $ Share capital Share premium Retained earnings Fair value adjustment: (Increase value of asset in revaluation compared to book value): Asset ( Increase value at X X acquisition date) Asset ( Increase value in post-acquisition period) X Depreciation (On increase X Value in revaluation) Write off development expenditure ( Not recognize as an asset ) Write back amortization of development expenditure ( De recognition as an asset )

The current accounts of the two companies are reconciled at the year-end with S

owing P $75000. S = Receivable in P’s SOFP P = Payable in S’s SOFP Accounting treatment : Group B/S: Current asset: $ P- Receivables X Less: Intra-group balance (75000)

Add: S-Receivables __X__ __X__

Current liability: $ P- Payables X

S- Payables X Less: Intra-group balance _(75000)_ __X__ __X__

The current accounts of the two companies are reconciled at the year-end with P owing S $75000.P = Receivable in S’s SOFPS = Payable in P’s SOFP

Accounting treatment : Group B/S: Current asset: $ P- Receivables X S- Receivables X Less: Intra-group balance _(75000)_ __X__ __X__

Current liability: $ P- Payables X Less: Intra-group balance _(75000)_ X S- Payables __X__ __X__