Giant ltd acquired 80 percent share capital of Expert ltd. On July 2018 for a cost of $1,600,000. As at the date of acquistion, all the assets and liabilities of Expert ltd were fairly valued except a land that has a carrying value $150,000 less than the fair value. The recorded balance of equity of Expert ltd as at 1 July 2018 were as: Share capital                  $800,000 Retained earnings         $200,000 General reserve              $400,000 Total                                $1,400,000 Additional information: (i) The management of Giant ltd values non-controlling interest at the proportionate share of Expert ltd identifiable net assets. (ii) Expert ltd has a profit after tax of $200,000 for the year ended 30 June 2019. (iii) During the financial year to 30 June 2019, Expert ltd sold inventory to Giant ltd for a price of $120,000. The inventory costs Expert ltd $60,000 to produce. 25 percent of the inventory are still on the hand of Giant ltd as at 30 June 2019. (iv) During the year Expert ltd paid $60,000  in consultancy fees to Giant ltd. (v) On 1 July 2018, Expert ltd sold an item of plant to Giant ltd $80,000. The equipment had a carrying value of $60,000(Cost $100,000, accumulated depreciation $40,000). At the date of sale, it was expected that the equipment had a remaining life of 4 years and no residual value. (vi) The tax rate is 30 percent. Required: (a) Based on the above information, calculate the non-controlling interest as at 30 June 2019. (b) Prepare the necessary journal entries to recognise the non-controlling interest as at 30 June 2019.

Q4) Giant ltd acquired 80 percent share capital of Expert ltd. On July 2018 for a cost of $1,600,000. As at the date of acquistion, all the assets and liabilities of Expert ltd were fairly valued except a land that has a carrying value $150,000 less than the fair value. The recorded balance of equity of Expert ltd as at 1 July 2018 were as:

Share capital                  $800,000

Retained earnings         $200,000

General reserve              $400,000

Total                                $1,400,000

Additional information:

(i) The management of Giant ltd values non-controlling interest at the proportionate share of Expert ltd identifiable net assets.

(ii) Expert ltd has a profit after tax of $200,000 for the year ended 30 June 2019.

(iii) During the financial year to 30 June 2019, Expert ltd sold inventory to Giant ltd for a price of $120,000. The inventory costs Expert ltd $60,000 to produce. 25 percent of the inventory are still on the hand of Giant ltd as at 30 June 2019.

(iv) During the year Expert ltd paid $60,000  in consultancy fees to Giant ltd.

(v) On 1 July 2018, Expert ltd sold an item of plant to Giant ltd $80,000. The equipment had a carrying value of $60,000(Cost $100,000, accumulated depreciation $40,000). At the date of sale, it was expected that the equipment had a remaining life of 4 years and no residual value.

(vi) The tax rate is 30 percent.

Required:

(a) Based on the above information, calculate the non-controlling interest as at 30 June 2019.

(b) Prepare the necessary journal entries to recognise the non-controlling interest as at 30 June 2019.