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Mids-Paper Numerical Questions Solution

This document provides financial information for Pallister and its subsidiary Stretcher, including consolidated balances. It includes assets, equity, liabilities and calculations for goodwill, non-controlling interest, and consolidated retained earnings. Additional information includes calculations for deferred tax assets and liabilities over multiple years, accounting for convertible bonds and share issuances.

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134 views

Mids-Paper Numerical Questions Solution

This document provides financial information for Pallister and its subsidiary Stretcher, including consolidated balances. It includes assets, equity, liabilities and calculations for goodwill, non-controlling interest, and consolidated retained earnings. Additional information includes calculations for deferred tax assets and liabilities over multiple years, accounting for convertible bonds and share issuances.

Uploaded by

Burhan Ahmed Mayo
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as XLSX, PDF, TXT or read online on Scribd
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Question 3

Pallister
$'000
Assets:
Intangible Assets:Goodwill
Rights
Non-Current Assets
PPE
Financial Assets Equity Investments

Current Assets:
Inventory
Trade Receivables
Bank
Total Assets
Equity & Liabilities:
Equity
Equity Shares of 1$ each
Share Premium
Other components of Equity
Retained Earnings - at 1 July 2015
for year ended 30 June 2015
Non-Controlling Interest
Current Liablities
Deffered Payment
Total Equity & Liabilities

17,000.00
14,300.00
2,200.00

Pallister
$'000

Stretcher
$'000

Consolidated
$'000

5,000.00
10,800.00
55,000.00
11,500.00
66,500.00

33,500.00

28,600.00
6,000.00
34,600.00

15,400.00
10,500.00
1,600.00

27,500.00

82,100.00
21,100.00
119,000.00

31,984.62
22,400.00
3,800.00

58,184.62

100,000.00

62,100.00

177,184.62

20,000.00

20,000.00

4,000.00
26,200.00
24,000.00

14,000.00
10,000.00

26,000.00
18,000.00
4,000.00

74,200.00
25,800.00

44,000.00
18,100.00

100,000.00

62,100.00

53,134.62
16,550.00
117,684.62
41,500.00
18,000.00
177,184.62

1 Net Assets Working:-

Share Capital
Retained Earnings
Plant FV adjustment
Investments FV adjustment
Intangibles
Intangibles amortization
Net Assets
2 Goodwill Calculation:Purchase Consideration:-

Non-Controlling Interest at Fair Value


Net Assets acquired
Goodwill
Impairment
Net Goodwill

At acquistion date
$'000

At reporting date
$'000
20,000.00
###
18,000.00
24,000.00
(2,000.00)
1,000.00
12,000.00
-

###
1,900.00
###
(1,200.00)

49,000.00

54,700.00

Deffered payment
Shares Capital Consideration

18,000.00
24,000.00
42,000.00
15,000.00
57,000.00
(49,000.00)
8,000.00
(3,000.00)
5,000.00

5,700.00

3 Non-Controlling Interest:At acquistion date


Share of Post Acquistion Profits
Depreciation Adjustment
NCI

Post-Acquistion Profits
4 Consolidated Retained Earnings:At start of year
Share of Post acquistion Profits
Profit for the year
PURP
Goodwill Impariment
Fair Value Adjustment of Investment
Depreciatioin Adjustment
Consolidated RE

ling Interest:-

st Acquistion Profits
n Adjustment

$'000
15,000.00
1,425.00
125.00
16,550.00

d Retained Earnings:-

st acquistion Profits

pariment
djustment of Investment
n Adjustment

26,200.00
4,275.00
24,000.00
(415.38)
(3,000.00)
1,700.00
375.00
53,134.62

2011
Rs.000
5,000.00
300.00
(500.00)
4,800.00
4,800.00

2012
Rs.000
5,250.00
###
(400.00)
5,150.00
###
5,150.00

Current Tax

1,200.00

1,287.50

Accounting Profit
Tax as per Accounting Profit

5,000.00
1,250.00

5,250.00
1,312.50

Current Tax
Deffered Tax
Tax Expense in P/L

1,200.00
50.00
1,250.00

1,287.50
25.00
1,312.50

200.00
50.00

100.00
25.00

Question 1
Accounting Profit
Accounting Depreciation
Tax Depreciation
Unearned Income Adjustment
Taxable Income

Temporary Difference
Deffered Tax

2013
Rs.000
4,500.00
300.00
(300.00)
4,500.00
500.00
5,000.00

2014
Rs.000
5,600.00
300.00
(200.00)
5,700.00
(500.00)
5,200.00

2015
Rs.000
5,500.00
300.00
(100.00)
5,700.00
5,700.00

1,250.00

1,300.00

1,425.00

4,500.00
1,125.00

5,600.00
1,400.00

5,500.00
1,375.00

1,250.00
(125.00)
1,125.00

1,300.00
100.00
1,400.00

1,425.00
(50.00)
1,375.00

(500.00)
(125.00)

400.00
100.00

(200.00)
(50.00)

DTA

DTA

Question 2
a)

Books of Sun Ltd.


31-12-2012
Share Capital
Share Premium

1,000,000.00
3,500,000.00

Books of Moon Ltd.


Current Assets:Investments

5,500,000.00

Profit & Loss Account:Gain or Loss on investment

1,000,000.00

b)
Year
31-12-2010
31-12-2011
31-12-2012
31-12-2013
31-12-2014

b/d
40,000.00
42,300.00
44,876.00
47,761.12
50,992.45

Finance Cost / Income


4,800.00
5,076.00
5,385.12
5,731.33
6,119.09

c)
Year

Cash Flows
1
2
3

100,000.00
100,000.00
1,100,000.00
Liability
Reserve

Year
31-12-2010
31-12-2011
31-12-2012

b/d
885,838.74
918,714.56
956,521.74

At Conversion Time
Dr.
Liability
Reserve
Equity

885,838.74
114,161.26

31-12-2013
1,000,000.00
3,500,000.00

31-12-2014
1,000,000.00
3,500,000.00

4,000,000.00

4,500,000.00

(1,500,000.00)

500,000.00

Cash Paid / Received


2,500.00
2,500.00
2,500.00
2,500.00
2,500.00

c/d
42,300.00
44,876.00
47,761.12
50,992.45
54,611.55
(50,000.00)
(4,611.00)
0.55

PV of Cash Flows
86,956.52
75,614.37
723,267.86
885,838.74
114,161.26
1,000,000.00
Finance Cost / Income
132,875.81
137,807.18
143,478.26

Cash Paid / Received


100,000.00
100,000.00
100,000.00

c/d
918,714.56
956,521.74
1,000,000.00

Cr.

1,000,000.00

30-06-2012
Share Price

45.00

Shares Issued
Transaction Cost
Face Value of Share

100,000
10,000.00
10.00

Rs.
Nominal Value
Discount (16%)

50,000.00
(8,000.00)
42,000.00
2,000.00

Transaction Cost
Coupon Rate
Effective Interest Rate
Premium on Redemption

Convertible Bond
Nominal Interest Rate
Effective Interest Rate

1,000,000.00
10%
15%

5%
12%
4,611.00

31-12-2012
55.00

31-12-2013
40.00

charged to Profit & Loss Account

p.a.
p.a.

31-12-2014
45.00

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