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consolidation and acquisition: Below are the statements of financial position and income statements for Xing plc and




Assignment;Below are the statements of financial position and income statements for Xing plc and;its subsidiary and associated companies, Yen and Zhen respectively, for the 12-month;period to 31 March 20X1.;Statements of Financial Position as at 31/03/20X1- All ?;Xing Yen Zhen;Non-current assets;Property, plant, equipment 435,000 285,000 195,000;Investment in subsidiary 220,000;Investment in associate 60,000;715,000 285,000 195,000;Current assets;Inventories 275,000 90,000 68,000;Trade receivables 160,000 48,000 35,000;Bank 36,000 5,000 8,000;471,000 143,000 111,000;Current liabilities;Trade payables -147,000 -72,000 -42,000;Dividend payable -200,000 -10,000 -9,000;-347,000 -82,000 -51,000;Net current assets 124,000 61,000 60,000;Non-current liabilities;Loan -120,000 -60,000 -25,000;Total net assets 719,000 286,000 230,000;Equity and reserves;Share capital 500,000 200,000 185,000;General reserve 50,000 16,000 10,000;Retained earnings 169,000 70,000 35,000;Shareholder?s funds 719,000 286,000 230,000;Xing plc acquired a 75% holding in Yen, Ltd., on 1 February 20X0 when the general;reserves of Yen were ?9,000 and retained profits were ?30,000. At the date of;acquisition, the fair value of Yen, Ltd., property, plant and equipment was considered;to be ?8,000 higher than its book value. After carrying out an asset impairment review;test, the management of Xing plc decided to write off 8% of the capitalised goodwill;on acquisition as an impairment loss at the end of the year to 31 March 20X1.;During the year to 31 March 20X1 Xing has sold Yen goods with a value of ?50,000;including a 30% margin on sales. At the end of the year, 80% of these goods;remained in stock.;Xing plc. also purchased a 25% shareholding in Zhen Ltd on 1 April 20X0, when the;book values were considered to be the same as the fair value at acquisition. The;general reserve of Zhen, Ltd., on acquisition was ?6,000, and retained profits were;?14,000.;Be sure to include your calculations within the same MS Word that you type;your assignment in.;Required;a) Prepare the group consolidated statement of financial position for Xing plc;and its group of companies for the year to 31 March 20X1.;b) Critically discuss the factors that Xing plc will have considered in;determining the fair values upon acquisition.


Paper#73981 | Written in 18-Jul-2015

Price : $27