All the identifiable assets and liabilities of Coverley Ltd were recorded at fair value. Profits and dividends for the years ended 30 June 2017 to
Please answer question B with step by step solution. Please provide me the answer ASAP as I need it urgent. Thanks in advance.
All the identifiable assets and liabilities of Coverley Ltd were recorded at fairvalue. Profits and dividends for the years ended 30 June 2017 to 2018 were asfollows: Profit Income tax Dividend Dividendbefore tax expense Paid Declared 2017 160 one 20 one so 000 20 nonm 120 can 50 000 _ 1. Prepare journal entries in the records of Bromley Ltd for each of the yearsended 30 June 201? to 2010 in relation to its investment in the associate,Coverley Ltd. (Assume Bromley Ltd does not prepare consolidatedfinancial statements.) 2. Prepare the consolidation worksheet entries to account for Bromley Ltd'sinterest in their associate, Coverley Ltd. (Assume Bromley Ltd doesprepare consolidated financial statements.) 3. Calculate the carrying amount of the investment in Coverley Ltd at 30 June2018. (C) Halem Ltd acquired a 30% interest in Morow Ltd for $200 000 an the 1 July, 2017.Halem Ltd accounts for this investment as an associate. At acquisition date, there is a fair value difference of $20 000 for some depreciable non-current assetsof Morow Ltd’s. These depreciabie assets are expected to have a further 10 yearlife. There is no goodwill or gain on bargain purchase. Profit after tax for Morow Ltd after the first year is $80 000. In this first year,Halem Ltd sold inventory to Morow Ltd and recorded a before profit of $20 000.At 30 June 2018, the inventory is unsold by Morow Ltd. In addition, Morow Ltd sold machinery to Halem Ltd for $50 000 on 1 July, 201?.The machinery had a carrying amount in Morow Ltd accounts of $42 000. Halemapplies 20% pa straight-line depreciation method. With the assistance of the class, discuss in detail the calculation of Halem Ltd'sshare of profit for 30 June, 2018.
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