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    Test 3 Finacc

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    Paul Chavunduka
    The document contains pro forma journal entries for the acquisition of a subsidiary and the calculation of goodwill. It also includes a statement of changes in equity and calculations related to deferred tax and retained earnings. Additionally, it shows the amortization of a capital lease over 12 months with principal and interest payments.

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    Test 3 Finacc

    Uploaded by

    Paul Chavunduka
    47 views8 pages
    The document contains pro forma journal entries for the acquisition of a subsidiary and the calculation of goodwill. It also includes a statement of changes in equity and calculations related to deferred tax and retained earnings. Additionally, it shows the amortization of a capital lease over 12 months with principal and interest payments.

    Original Description:

    Test 3 Financial Accounting

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    The document contains pro forma journal entries for the acquisition of a subsidiary and the calculation of goodwill. It also includes a statement of changes in equity and calculations related to deferred tax and retained earnings. Additionally, it shows the amortization of a capital lease over 12 months with principal and interest payments.

    Copyright:

    © All Rights Reserved
    Download as XLSX, PDF, TXT or read online from Scribd
    Download as xlsx, pdf, or txt
    47 views8 pages

    Test 3 Finacc

    Uploaded by

    Paul Chavunduka
    The document contains pro forma journal entries for the acquisition of a subsidiary and the calculation of goodwill. It also includes a statement of changes in equity and calculations related to deferred tax and retained earnings. Additionally, it shows the amortization of a capital lease over 12 months with principal and interest payments.

    Copyright:

    © All Rights Reserved
    Download as XLSX, PDF, TXT or read online from Scribd
    Download as xlsx, pdf, or txt
    of 8

    Question 1 Part a

    a) Pro forma Journal Entries

    Dr
    Share Capital 2400000
    Retained Earnings 540000
    Revaluation Surplus 155200
    Equity at aqcuisition
    Investment in Subsidiary (given)
    NCI (SFP) (given)
    Goodwill 523034

    Analysis Of Equity - Salah

    75% Interest NCI


    At Since

    Share Capital 2400000 1800000 600000


    Retained Earnings 540000 405000 135000
    Revaluation Surplus 155200 116400 38800
    Equity at Acquisition (Calc 1) -17928 -13446 -4482
    3077272 2307954 769318
    Goodwill 392352 130682
    Consideration and NCI 2700306 900000

    Calc 1
    Machinery: 400 000 - 360 000 = 40000 therefore allocated to equity = 40 000 * 0,72 = 28800
    Trade receivable = (18900) therefore allocated to equity = (18900 * 0,72) = -13608
    Loan = 990 000 - 944 000 = 46000 therefore allocated to equity = (-46000) * 0,72 = -33120

    Equity at Acquisition = -17928


    Cr

    17928
    2700306
    900000
    Question 1 Part b

    Dr Cr

    Depreciation 6000
    Accumulated Depreciation 6000

    Deferred Tax SFP 1680


    Income Tax Expense 1680

    Calc
    Salah Pro Forma Entry Group(1 Mar 19)
    Machinery 360,000 40,000 400,000
    Accumulated Dep 144000 144000
    Depreciation(1 sold 1 remaining) 54000 6000 60000
    Deferred Tax (at) 11200
    Deferred Tax (since) 1680
    Liverpool & Salah Group Statement of Changes in Equity for the Year Ended 28 February 2020

    Retained Earnings Revaluation Surplus

    Balance at the beginning of the year R1,392,672.00 R921,500.00

    Total comprehensive income R1,872,376.00


    Profit for the year R2,162,376.00
    Other Comprehensive Income R212,313.60
    Impairment of Goodwill -R200,000.00

    Dividends for the year -R90,000.00

    Balance at the end of the year R3,265,048.00 R1,133,813.60

    Calc 1
    Deferred Tax: At (40000 *0,28)-(18900*0,28)-(46000*0,28) = -R 6,972.00
    Deferred Tax: Since = R 1680,00
    Retained Earnings at beginning = (859200+702000*0,75)+6972 R 1,392,672.00
    Revaluation Suplus at beginning = 543200+504400*0,75 = R 921,500.00
    Revaluation Suplus = (310400+0,75*77600)*0,8*0,72 = R 212,313.60
    luation Surplus
    Lease Armotization

    No/Yr Date Payment Interest

    1:01 0.00 0.00


    1:01 01/03/2019 8,363.00 0.00
    2:01 01/04/2019 8,363.00 2037.92
    3:01 01/05/2019 8,363.00 1991.75
    4:01 01/06/2019 8,363.00 1945.23
    5:01 01/07/2019 8,363.00 1898.38
    6:01 01/08/2019 8,363.00 1851.19
    7:01 01/09/2019 8,363.00 1803.65
    8:01 01/10/2019 8,363.00 1755.77
    9:01 01/11/2019 8,363.00 1707.53
    10:01 01/12/2019 8,363.00 1658.94
    11:01 01/01/2020 8,363.00 1610
    12:01 01/02/2020 8,363.00 1560.7

    Balance of lease = R 206,984.06


    Interest Expense = R 19,821.06
    Depreciation = ((287519+10000+5000)-9300)/5 R 58,643.80

    Equipment (287519+10000+5000)
    Cap Lease obligation
    Cash
    Interest espense
    Cap lease Obligation
    Depreciation
    Accumulated Depreciation
    Cash (Lease payments R8363 * 12)
    Principal Balance

    0.00 287,519.00
    8,363.00 279,156.00
    6,325.08 272,830.92
    6,371.25 266,459.67
    6,417.77 260,041.90
    6,464.62 253,577.28
    6,511.81 247,065.47
    6,559.35 240,506.12
    6,607.23 233,898.89
    6,655.47 227,243.42
    6,704.06 220,539.36
    6,753.00 213,786.36
    6,802.30 206984.06

    Dr Cr

    R 302,519.00
    R 287,519.00
    R 15,000.00
    R 19,821.06
    R 80,534.94
    R 58,643.80
    R 58,643.80
    R 100,356.00

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