Question

could you please help me to solve this exercise?

many thanks

SURNA NAME 5. Ihe Spider hal acquires all the isei d cul-tal of MA--"ach ren on 30 May 2019 Subsidiary Plain assets have a tok value of s S80 Fi the following tabde with the issing Hem goohwill arising on consolidation (demonstration of the coputss Statement of Financial Position E himinalkorGroup E ntries Spider Ltd Fly Ltd Non-current assets Plant 800 Land 200 40 Investment in Subsidiary Plc Current assets Cash 10 10 50 Accounts receivable 150 Total Assets Shareholders' equity 200 1000 Share capital 200 280 Retained earnings Non-current liabilities 150 300 Loans Current liabilities 30 260 Accounts payable 1760 Total Liabilities and Equity

Answer 1

1. Calculation of goodwill
Particulars		Amount
Plant		580
Land		40
Cash		10
Accounts receivable		50
TOTAL ASSETS		680
Less :
Accounts payable		30
Loans		150
NET ASSETS		500
Less :
Purchase consideration		600
GOODWILL		100

2. Elimination entry
Plant A/c Dr			580
Land A/c Dr			40
Cash A/c Dr			10
Accounts receivable A/c Dr			50
Goodwill A/c Dr.			100
To Accounts payable				30
To Loan				150
To Investment in subsidiary				600

3. Group Financial position
Non-current assets :
Plant (800+580)			1380
Land (200+40)			240	1620
Current Assets :
Cash (10+10)			20
Accounts receivable (150+50)			200
Goodwill			100	320
TOTAL ASSETS				1940
Shareholders Equity :
Share capital			1000
Retained earnings			200	1200
Loans (300+150)			450
Accounts payable (260+30)			290	740
TOTAL LIABILITIES				1940