The following are the trial balances of H Ltd and S Ltd at 31 December 2018. H Ltd S Ltd
The following are the
H Ltd S Ltd
Non-current assets (PPE) 185 000 85 000
Share Capital (200 000) (80 000)
Investment in S Ltd, at cost 65 000
Deferred
Long term liabilities (18 000) (4 000)
Current assets 55 200 49 000
Profit before tax (45 000) (25 000)
Taxation 12 000 6 000
Additional information:
• H Ltd acquired 60% of the shares in S Ltd on 31 December 2016 when the
retained earnings for S Ltd was R20 000.
• S Ltd purchased all its inventories from H Ltd at cost price plus 25%. The
inventories on S Ltd’s books amounted to R3 600 at 31 December 2017 and
R10 800 at 31 December 2018.
• Assume that the cost price or carrying amount equals the current fair value.
Required:
Prepare the abbreviated consolidated
subsidiary.
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