Advanced Financial Accounting 260 Assignment – Semester 2, 2014   Consolidated Financial Statements   Essay

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ADVANCED FINANCIAL ACCOUNTING 260 ASSIGNMENT – SEMESTER 2, 2014 CONSOLIDATED FINANCIAL STATEMENTS On 1 July 2011, Kookaburra Ltd acquired all the shares of Magpie Ltd on a cum div basis. At this date, the equity and liability sections of Magpie Ltd.’s statement of financial position showed the following balances: Share Capital (60 000 shares) $60 000 General Reserve $30 000 Retained Earnings $21 000 Option Reserve $6 000 Dividend payable $5 000 The dividend payable at acquisition date was subsequently paid in September 2011. At acquisition date, all the identifiable assets and liabilities of Magpie Ltd were recorded at amounts equal to fair value except for: Carrying Fair Amount Value Inventory $50 000 $56 000 Machinery (cost $17 000) 15 000 16 000 Equipment (cost $30 000) 24 000 32 000 Land 18 480 24 480 Manufacturing Software (cost $36 000) 28 800 31 800 The manufacturing software is a custom-designed programme used by Magpie Ltd to run its robotic manufacturing

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