Consolidation of wholly owned subsidiary, pre-acquisition equity and BCVR entries for assets and liabilities Tamara Ltd acquired all the issued shares of Rex Ltd on 1 January 2016 for $88 000. At this date the equity of Rex Ltd consisted of:

Share capital $ 40 000 General reserve 10 000 Retained earnings 8 000 All the identifiable assets and liabilities of Rex Ltd were recorded at amounts equal to their fair values except for:

Carrying amount Fair value Fixtures & Fittings (cost $70 000) $50 000 $55 000 Inventory 10 000 16 000 Of the inventory on hand at 1 January 2016, 90% was sold by 30 June 2016. The remainder was all sold by 30 June 2017. The Fixtures & Fittings was considered to have a further 2-year life with benefits to be received equally in each of those years. There were no records in the books for a provision of legal claim worth 5,000 and patents of 60,000. These were reflected at fair value. The tax rate is 30%.

Required Prepare the consolidated worksheet entries for the consolidated financial statements prepared by Tamara Ltd at 30 June 2016. Show acquisition analysis calculation, BCVR entries and Pre-acquisition entries for 30.6.16

Question 2 (10 marks) The following information has been extracted from the accounting records of London Ltd for the year ended 30 June 2016: Debit Credit Sales Dividends paid Cost of sales Finance costs $ 5 000 1 060 000 44 000 $2 000 000

Distribution costs Transfer from general reserve Marketing costs Administrative costs Proceeds from sale of plant and machinery Carrying amount of plant and machinery

104 000 64 000 94 000

40 000 11 000

60 000 Tax rate is 30%. Required Prepare a statement of profit or loss and other comprehensive income for London Ltd, for the year ended 30 June 2016, and notes to the accounts in compliance with AASB 101. Please classify expenses by function