70%

AQ Cost 84,000
implied cost 120,000
Calculation AD
(Note A-L or Use CS +RE)
ordinary shares (B/S) 50,000
RE 18,000 68,000
Acquisition differential 52,000

Allocation of FV FV-CA
Inventories (15,000)
unfavourable lease agreeme (21,000)
Totals (36,000)
Goodwill 88,000

Amortization table Current I/S

Open SFP Changes in R/E Consol NI SFP
Start Changes Balance
Jan 1, Y4 Prior to YE Current Year 31-Dec
Y 4-5 Y6 Y6
Inventories (15,000) (15,000) 0 0
unfavourable lease agreeme (21,000) (8,400) (4,200) (8,400)
Goodwill 88,000 (3,240) (1,350) 83,410
52,000 - 20,160 - 2,850 75,010

intercompany receivables and payables 54000

intercompany revenues and expenses

management fees 27000
sales and purchases
post made sales 130000
sage made sales 85000 215000
interest 3240

intercompany profits
B/Ftax Tax 40% After Tax
land- sage selling to post 34000 13600 20400
opening inventory - sage sel 4250 1700 2550
ending inventory-sage to po 7500 3000 4500
ending inventory-post sellin 5250 2100 3150
 12750 5100 7650

deferred income taxes - Dec 31 Yr 6

inventory 5100
land 13600
18700
accumulated depreciation at date of acquisition 13000

Consolidated NI
Profit - Post 80610
less: equity method income from sage 3010
less: profit in ending inventory 3150 6160
adjusted profit 74450

profit - sage 28300

add: profit in opening inventory 2550 30850
add: amortization of acq. Differentiation 2,850
less: profit in end. Inventory 4500
less: land gain 20400 24900
adjusted profit 8,800
Profit 83250

attributable to
Shareholders of Post 80610
NCI 2,640
83250

a.i. Post Corporation

Consolidated Statement of Profit
Dec 31, Yr 6
sales 887,000 =(sales of post+sales of sage+
interest revenue 3,060 =(sage interest revenue+
Total revenue 890,060
COGS 468,500 =post COGS+sage COGS +
interest expenses 18,160 =post interest expense+
other expenses 225,800 =post + sage 0ther expenses+
Goodwill impairment los 1,350
income tax expene 93,000 =post+sage income expense+
Total expenses 806,810
Profit 83,250

attributable to
Shareholders of Post 80,610
NCI 2,640
 83,250

Calculation of NCI-Dec 31, Yr6

ordinary shares 50000 sage - from B/S
retained earnings 81000 sage - from B/S
total shareholders equity 131000
less: proft in ending inventory 4500
less: land gain 20400 24900
add: unamortized acquisition differential 75,010
adjusted shareholders equity 181,110
NCI interest shares 30%
NCI interest, Dec 31 Yr 6 54,333

a.2 Post Corporation

Consolidated Statement of Profit
Dec 31, Yr 6

land 159,000 =sage + post land +

P&E 559,000 =sage + post land +
acc. Depreciation - 230,000 =sage + post land +
Goodwill 83,410
deferred income taxes 18,700
inventory 49,250 =sage + post land +
A/R 25,300 =sage + post land
cash 23,600 =sage + post land
Total assets 688,260

ordinary shares 100,000 =post B/S

R/E 265,600 =post B/S
NCI 54,333
419,933
unfavourable lease agre 8,400
A/P 259,927 =sage + post land
Total shareholders eq. & 688,260

goodwill impairment loss 1,350

less: NCI share - 30% 405
Goodwill impairment loss-parent company extension 945

NCI-entity theory 2,640

NCI share of goodwill imp loss 405
NCI-parent company ex theory 3,045

Goodwill impairment loss 83,410.00

less: NCI' share 30% 25,023.00
Goodwill impairment loss-INA 58,387.00

NCI FVE Method

NCI;s share of goodwilll impairment loss 54,333.00
NCI-INA 25,023.00
29,310.00

Consolidated Financial Statement Working Paper

Post Corporation
Consolidated Financial Statement
December 31, Year 6
Entries
Post Sage Dr.
Income Statements - Year 6
Sales 950,000 271,000 215,000
Management fee revenue 29,000 0 29,000
Interest revenue 0 7,300 3,240
Investment income from Sage 1,730 0 1,730
Gain on sale of land 0 38,000 38,000
Total income 980,730 316,300
Cost of goods sold 590,000 196,000 12,750
Interest expense 20,500 0 0
Other expenses 185,000 75,300 0
Goodwill impairment loss 0 0 1,350
Income tax expense 85,000 16,000 1,700
Total expenses 880,500 287,300
Profit 100,230 29,000
Attributable to:
Shareholders of Peter 0 0 0
Non-controlling interest 0 0 2,640
Total 305,410
Year 6 retained earnings statements
Balance, January 1 165,370 52,000 52,000
Profit 100,230 29,000 305,410
 265,600 81,000
Dividends 0 0 0
Balance, December 31 265,600 81,000 357,410
Statements of Financial Position - December 31, Year 6
Land 180,000 24,000 0
Plant and equipment 535,000 68,000 0
Accumulated depreciation -235,000 -22,000 13,000
Investment in Sage 143,039 0 34,131
Goodwill 0 0 84,760
Deferred income taxes 0 0 18,700
Inventory 34,000 32,000 0
Notes receivable 0 58,000 0
Accounts receivable 17,700 11,400 0
Cash 12,700 14,400 0
Total assets 687,439 185,800
Ordinary shares 100,000 50,000 50,000
Retained earnings 265,600 81,000 357,410
Non-controlling interest 0 0 0
Notes payable 54,000 0 54,000
Unfavourable lease agreement 0 0 4,200
Accounts payable 220,927 39,000 0
Total Shareholders' equity & liabilities 640,527 170,000 616,201
inventory - Dec 31, Yr 5 17000
gross profit rate 25%
inventory Dec 31, Yr 6 sage to p 30000
Inventory Dec 31, Yr 6 post to s 21000
-215000 )
-3240

-215000 -4250 12750

-3240
-27000 -4200

1700 -5100 -13600

184990 52700

-34000
-13000
-13000

-12750
Working Paper

tement
6
Entries
Cr. Consolidated

0 887,000
0 0
0 3,060
0 0
0 0
890,060
219,250 468,500
3,240 18,160
31,200 225,800
0 1,350
18,700 93,000
806,810
83,250

0 80,610
0 2,640
272,390 83,250

0 165,370
272,390 80,610
 245,980
0 0
272,390 245,980

34,000 159,000
13,000 559,000
0 -230,000
177,170 0
1,350 83,410
0 18,700
12,750 49,250
58,000 0
0 25,300
0 23,600
688,260
0 100,000
272,390 265,600
54,333 54,333
0 0
12,600 8,400
0 259,927
635,593 688,260
-
-
 0.70
AQ Cost 98,000.00
implied cost 140,000.00
Calculation AD
(Note A-L or Use CS +RE)
CS 50,000.00
RE 20,000.00 70,000.00
Acquisition differential 70,000.00
-
Allocation of FV FV-CA
Inventories - 17,000.00
unfavourable lease agreements - 23,000.00
Totals - 40,000.00 -
Goodwill 110,000.00
-

Amortization table Current I/S

Open SFP Changes in R/E Consol NI
Start Changes
Jan 1, Y4 Prior to YE Current Year
Y 4-5 Y6
Inventories - 17,000.00 - 17,000.00 -
unfavourable lease agreements - 23,000.00 - 9,200.00 - 4,600.00
Goodwill 110,000.00 - 3,480.00 - 1,450.00
70,000.00 - 22,720.00 - 3,150.00

intercompany receivables and payables 58,000.00

intercompany revenues and expenses

management fees 29,000.00
sales and purchases
post made sales 132,000.00
sage made sales 114,000.00 246,000.00
interest 3,480.00

intercompany profits
B/Ftax Tax 40% After Tax
land- sage selling to post 38,000.00 15,200.00 22,800.00
opening inventory - sage selling 4,750.00 1,900.00 2,850.00
ending inventory-sage to post 8,000.00 3,200.00 4,800.00
ending inventory-post selling 5,750.00 2,300.00 3,450.00
 13,750.00 5,500.00 8,250.00

deferred income taxes - Dec 31 Yr 6

inventory 5,500.00
land 15,200.00
20,700.00
accumulated depreciation at date of acquisition 15,000.00

Consolidated NI
Profit - Post 100,230.00
less: equity method income from sage 1,730.00
less: profit in ending inventory 3,450.00 5,180.00
adjusted profit 95,050.00

profit - sage 29,000.00

add: profit in opening inventory 2,850.00 31,850.00
add: amortization of acq. Differentiation 3,150.00
less: profit in end. Inventory 4,800.00
less: land gain 22,800.00 27,600.00
adjusted profit 7,400.00
Profit 102,450.00

attributable to
Shareholders of Post 100,230.00
NCI 2,220.00
102,450.00

a.i. Post Corporation

Consolidated Statement of Profit
Dec 31, Yr 6
sales 975,000.00 =(sales of post+sales of sage+
interest revenue 3,820.00 =(sage interest revenue+
Total revenue 978,820.00
COGS 549,000.00 =post COGS+sage COGS +
interest expenses 17,020.00 =post interest expense+
other expenses 226,700.00 =post + sage 0ther expenses+
Goodwill impairment los 1,450.00
income tax expene 82,200.00 =post+sage income expense+
Total expenses 876,370.00
Profit 102,450.00

attributable to
Shareholders of Post 100,230.00
NCI 2,220.00
 102,450.00

Calculation of NCI-Dec 31, Yr6

ordinary shares 50,000.00
retained earnings 91,000.00
total shareholders equity 141,000.00
less: proft in ending inventory 4,800.00
less: land gain 22,800.00 27,600.00
add: unamortized acquisition differential 95,870.00
adjusted shareholders equity 209,270.00
NCI interest shares 0.30
NCI interest, Dec 31 Yr 6 62,781.00

a.2 Post Corporation

Consolidated Statement of Profit
Dec 31, Yr 6

land 166,000.00 =sage + post land +

P&E 588,000.00 =sage + post land +
acc. Depreciation - 242,000.00 =sage + post land +
Goodwill 105,070.00
deferred income taxes 20,700.00
inventory 52,250.00 =sage + post land +
A/R 29,100.00 =sage + post land
cash 27,100.00 =sage + post land
Total assets 746,220.00

ordinary shares 100,000.00 =post B/S

R/E 266,400.00 =post B/S
NCI 62,781.00
429,181.00
unfavourable lease agreement 9,200.00
A/P 307,839.00 =sage + post land
Total shareholders eq. & liabi 746,220.00

goodwill impairment loss 1,450

less: NCI share - 30% 435
Goodwill impairment loss-parent company extension theory 1,015

NCI-entity theory 2,220

NCI share of goodwill imp loss 435
NCI-parent company ex theory 2,655

Goodwill impairment loss 105,070.00

less: NCI' share 30% 31,521.00
Goodwill impairment loss-INA 73,549.00

NCI FVE Method

NCI;s share of goodwilll impairment loss 62,781.00
NCI-INA 31,521.00
31,260.00

Consolidated Financial Statement Working Paper

Post Corporation
Consolidated Financial Statement
December 31, Year 6

Post Sage
Income Statements - Year 6
Sales 950,000 271,000
Management fee revenue 29,000 0
Interest revenue 0 7,300
Investment income from Sage 1,730 0
Gain on sale of land 0 38,000
Total income 980,730 316,300
Cost of goods sold 590,000 196,000
Interest expense 20,500 0
Other expenses 185,000 75,300
Goodwill impairment loss 0 0
Income tax expense 85,000 16,000
Total expenses 880,500 287,300
Profit 100,230 29,000
Attributable to:
Shareholders of Peter 0 0
Non-controlling interest 0 0
Total
Year 6 retained earnings statements
Balance, January 1 166,170 62,000
Profit 100,230 29,000
 266,400 91,000
Dividends 0 0
Balance, December 31 266,400 91,000
Statements of Financial Position - December 31, Year 6
Land 180,000 24,000
Plant and equipment 535,000 68,000
Accumulated depreciation -235,000 -22,000
Investment in Sage 143,039 0
Goodwill 0 0
Deferred income taxes 0 0
Inventory 34,000 32,000
Notes receivable 0 58,000
Accounts receivable 17,700 11,400
Cash 12,700 14,400
Total assets 687,439 185,800
Ordinary shares 100,000 50,000
Retained earnings 266,400 91,000
Non-controlling interest 0 0
Notes payable 58,000 0
Unfavourable lease agreement 0 0
Accounts payable 263,039 44,800
Total Shareholders' equity & liabilities 687,439 185,800
 SFP
Balance
44,196.00
Y6
-
- 9,200.00
105,070.00
95,870.00

inventory - Dec 31, Yr 5 19,000.00

 gross profit rate 0.25
inventory Dec 31, Yr 6 sage to 32,000.00
Inventory Dec 31, Yr 6 post to 23,000.00

=(sales of post+sales of sage+ - 246,000.00 )

=(sage interest revenue+ - 3,480.00

=post COGS+sage COGS + - 246,000.00 - 4,750.00

=post interest expense+ - 3,480.00
=post + sage 0ther expenses+ - 29,000.00 - 4,600.00

=post+sage income expense+ 1,900.00 - 5,500.00

 sage - from B/S
sage - from B/S

=sage + post land + - 38,000.00

=sage + post land + - 15,000.00
=sage + post land + - 15,000.00

=sage + post land + - 13,750.00

age + post land
age + post land

age + post land

 Statement Working Paper
orporation
inancial Statement
er 31, Year 6
Entries
Dr. Cr. Consolidated

246,000 0 975,000
29,000 0 0
3,480 0 3,820
1,730 0 0
38,000 0 0
978,820
13,750 250,750 549,000
0 3,480 17,020
0 33,600 226,700
1,450 0 1,450
1,900 20,700 82,200
876,370
102,450

0 0 100,230
2,220 0 2,220
337,530 308,530 102,450

62,000 0 166,170
337,530 308,530 100,230
 266,400
0 0 0
399,530 308,530 266,400

0 38,000 166,000
0 15,000 588,000
15,000 0 -242,000
63,411 206,450 0
106,520 1,450 105,070
20,700 0 20,700
0 13,750 52,250
0 58,000 0
0 0 29,100
0 0 27,100
746,220
50,000 0 100,000
399,530 308,530 266,400
0 62,781 62,781
58,000 0 0
4,600 13,800 9,200
0 0 307,839
717,761 717,761 746,220
 13,750.00

- 15,200.00
-
-