Page 262 - F2 Integrated Workbook STUDENT 2019

Chapter 11

Example 11.5

Given below are the statements of profit or loss and other comprehensive
income for Furio and its subsidiary, Livia, for the year ended 31 December
20X5:

Furio Livia
$000 $000
Revenue 5,280 4,224
Cost of sales (1,980) (1,782)
––––– –––––
Gross profit 3,300 2,442
Operating expenses (924) (660)
––––– –––––
Profit from operations 2,376 1,782
Investment income 264 –
––––– –––––
Profit before tax 2,640 1,782
Income tax expense (660) (792)
––––– –––––
Profit for the year 1,980 990
Other comprehensive income 495 165
––––– –––––
Total comprehensive income 2,475 1,155
––––– –––––

Furio acquired 80% of Livia’s equity shares on 1 October 20X5.

1 Goodwill was calculated valuing the NCI at fair value at the date of
acquisition. At 31 December 20X5, it was determined that goodwill arising
on the acquisition had been impaired by $49,500. Impairments are
charged to operating expenses.

2 Furio sold $100,000 goods to Livia since the acquisition date. Furio sells at
a 10% gross profit margin. 10% of the goods remained in Livia’s inventory
as at the year end.

3 Livia paid a dividend of $247,500 on 15 December 20X5.

Required:

Prepare a consolidated statement of profit or loss and other
comprehensive income for the year ended 31 December 20X5.

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