2. Prepare the consolidation worksheet entries for Dean Ltd's group at 1 July 2022, assuming that Lewis Ltd has not revalued the equipment in its own accounts.
2. Prepare the consolidation worksheet entries for Dean Ltd's group at 1 July 2022, assuming that Lewis Ltd has not revalued the equipment in its own accounts.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
27.4 question 2 what does it mean by "not revalued the equipment in its own accounts"
why the asset revaluation surplus=35000
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cash for the shares in Kidman Ltd.
27.4 Undervalued and unrecorded assets, unrecorded liabilities
On 1 July 2022, Dean Ltd acquired all the issued shares of Lewis Ltd for a cash consideration of
$1 000 000. At that date, the financial statements of Lewis Ltd showed the following information.
LO3, 4
Share capital
$650 000
General reserve
20 000
Retained earnings
250 000
All the assets and liabilities of Lewis Ltd were recorded at amounts equal to their fair values at
the acquisition date, except some equipment recorded at $50 000 below its fair value with a related
accumulated depreciation of $80 000. Also, Dean Ltd identified at acquisition date a contingent
liability related to a lawsuit where Lewis Ltd was sued by a former supplier and attached a fair
value of $40 000 to that liability.
Required
1. Prepare the acquisition analysis at 1 July 2022.
2. Prepare the consolidation worksheet entries for Dean Ltd's group at 1 July 2022, assuming that
Lewis Ltd has not revalued the equipment in its own accounts.
3. Prepare the consolidation worksheet entries for Dean Ltd's group at 1 July 2022, assuming that
Lewis Ltd has revalued the equipment in its own accounts.
27.5 Pre- and post-acquisition dividends
LO3, 4, 5
On 1 July 2022, George Ltd acquired all the issued shares (cum div.) of Ezra Ltd for $480 000. At
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