PRACTICE QUESTION 1

On 1 April 2008 Professionals acquired 75% of Academys equity shares for Cash. On the
same day, Academys Retained Earning was Rs. 1,550,000. It is also revealed that on 1 April
2008, FV of Land of Academy was Rs. 4,800,000.
Summarised statements of financial position of the two companies at 31 March 2010 are:

Professionals
Rs.(000)

Academys
Rs.(000)

10,000
21,855
7,225

4,000
2,196

Sub-total
Current Assets
Inventory
Receivable and Deposits
Cash and Bank Balances

39,080

6,196

9,524
10,215
985

1,125
896
456

Sub-total

20,724

2,477

59,804

8,673

5,150

Sub-total
Current Liabilities
Accrued and Other Payables
Provision for Tax

5,150

8,542
428

789
124

Sub-total
Capital and Reserves
Share Capital @ 1,000 each
Retained Earnings
Other Capital Reserves
Sub-total

8,970

913

25,000
15,527
5,157
45,684

5,000
2,760
7,760

59,804

8,673

Non-Current Assets
Land
Other Non-Current Assets
Investment

Total
Non-Current Liabilities
8% Loan

Total

REQUIRED
Prepare the consolidated Balance Sheet of the Group as of 31 st March, 2010. It is the
company Policy to value NCI as proportionate share of FV of net Assets of the
subsidiary.
PRACTICE QUESTION

Summarised statements of financial position of the two companies at 31 December 2012

are:

Pitech
Rs.(000)

Zetech
Rs.(000)

Assets and Properties

Non Current Assets
Investment

33,730
6,000

4,225

Stock in hand
Receivable and Deposits
Cash and Bank Balances

5,245
9,148
324

953
1,257
326

54,447

6,761

4,228

524

35,000
3,000
12,219

4,000

54,447

6,761

Total
Current Liabilities
Accrued and Other Payables
Capital and Reserves
Share Capital @ 1,000 each
Share Premium
Retained Earnings
Total

2,237

OTHER INFORMATION
1) 3 years ago Pitech acquired Zetech in a share exchange transaction as three shares
in Pitech for every four shares in Zetech. The market price of shares of Pitech at the
acquisition date was Rs. 20.
2) At acquisition date Retained Earning of Zetech stood at Rs, 1,452,000. And no
further shares have been issued by the Zetech since acquisition. Further revealed
that FV of net assets of the Zetech at the acquisition date was increased by Rs.
900,000. This FV increase relates to non- depreciable assets only.
3) Receivable balance of Pitech includes Rs. 500,000 which are receivable from Zetech
Company. But Zetechs books of accounts showed only Rs. 300,000 payable to Pitech.
This difference is due to cheque of Rs. 200,000 issued by Zetech but was not
received by the Pitech till year end.

4) It is the company Policy to value NCI as proportionate share of FV of net

Assets of the subsidiary.
REQUIRED
Prepare the consolidated Balance Sheet of the Group as of 31 st December, 2012.
PRACTICE QUESTION

Summarised statements of financial position of the two companies at 31 October 2013 are:

Pinka
Rs.(millions)

Sima
Rs.(millions)

Assets and Properties

Non Current Assets
Investment

1,020
450

340

Stock in hand
Receivable and Deposits
Cash and Bank Balances

245
248
74

150
170
55

2,037

715

128

54

1,500
409

500
161

2,037

715

Total
Current Liabilities
Accrued and Other Payables
Capital and Reserves
Share Capital @ 1,000 each
Retained Earnings
Total

OTHER INFORMATION
1) 2 years before Pinka acquired 70% equity shares of Sima for cash.
2) At acquisition date Retained Earning of Sima was Rs. 90 m. FV of net assets of the
Sima was Rs. 600m. FV of NCI as of acquisition date was 200m. FV increase relates to
non- depreciable assets only.
3) During the year, Sima sold goods to Pinka for Rs. 60m(sales value) on gross profit of
20% on SP. Only 50% of these goods were sold by Pinka to external customer till year
end.

REQUIRED
Prepare the consolidated Balance Sheet of the Group as of 31 st December, 2012.