The summarized statement of financial positions of A Ltd and BLtd as at 31 December 2018 are as follows:
| A Ltd | B Ltd |
Non-Current Assets at book value | 60,000 | 46,000 |
Investment in B Ltd | 75,000 | |
Current assets | | |
Inventory | 32,000 | 13,000 |
Receivables | 27,000 | 17,000 |
Bank | 1,000 | 2,000 |
| 195,000 | 78,000 |
Financed by: | | |
Share capital (Sh 1ordinary shares) | 100,000 | 50,000 |
Retained profits | 70,000 | 12,000 |
| 170,000 | 62,000 |
Liabilities | 25,000 | 16,000 |
| 195,000 | 78,000 |
A Ltd purchased the entire share capital of B Ltd on 31 December2018. The Non-Current Assets of B Ltd are considered to possess afair value of sh.54,000 but there are no material differencesbetween the book values and fair values of the remainingassets.
Required
- Calculate the goodwill arising on consolidation
- Prepare the consolidated statement of financial position of ALtd and it subsidiary as at 31 December 2018
Note: Ignore depreciation
