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On 1 July 2021 Garden Ltd acquires 70 per cent of the equity capital of Richards Ltd at a cost of $4 million. At the date of acquisition all assets of Richards Ltd are fairly stated, and the total shareholders funds of Richards Ltd are $4.4 million, consisting of:

Share capital	$3 000 000
Retained earnings	$1 400 000
	$4 400 000

As at 30 June 2023 (two years after the date of acquisition) the financial statements of the two companies are as follows:

	Garden Ltd ($000	Richards Ltd ($000
Detailed reconciliation of opening and closing retained earnings
Sales revenue	800	200
Cost of goods sold	(200)	(80)
Other expenses	(120)	(60)
Other revenue	310	85
Profit	790	145
Tax	(170)	(35)
Profit after tax	620	110
Retained earnings1 July 2022	2 000	1 600
	2 620	1 710
Dividends paid	(400)	(80)
Retained earnings30 June 2023	2 220	1 630
Statement of financial position
Shareholders equity
Retained earnings	2 220	1 630
Share capital	8 000	3 000
Current liabilities
Accounts payable	120	80
Non-current liabilities
Loans	1200	500
	11 540	5 210
Current assets
Cash	300	50
Accounts receivable	500	350
Inventory	1 000	600
Non-current assets
Land	2 800	2 210
Plant	2 940	2 000
Investment in Richards Ltd	4 000	_
	11 540	5 210

Additional information

A. The management of Garden Ltd measures any non-controlling interest in Richards Ltd at fair value.

B. During the 2023 financial year, Richards Ltd sells $45 000 of inventory to Garden Ltd. At year end, Garden Ltd has sold all of this inventory.

The tax rate is 35 per cent.

REQUIRED

1. Calculate Goodwill on acquisition date.

2. Prepare necessary consolidation journal entries for Garden Ltd as at 30 June 2023.

3. Post the journal entries to the consolidation worksheet of Garden Ltd as at 30 June 2023.

4. Prepare the consolidated statement of financial position of Garden Ltd as at 30 June 2023.

5. Prepare consolidated statement of profit or loss and other comprehensive income of Garden Ltd for financial year ended 30 June 2023.

6. Prepare consolidated statement of changes in equity of Peterson Ltd as at 30 June 2023.

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