CASE STUDY OF ABC LTD AND XYZ LTD
ABC Ltd made a takeover bid for all the issued voting shares of XYZ Ltd offering three ABC Ltd shares for every two XYZ Ltd shares. The offer from ABC Ltd was accepted by 90% of the shareholders of XYZ Ltd. The date control was obtained by ABC Ltd was deemed to be 1 January 20X7. The following information is available.
(a) Shareholders’ equity of XYZ Ltd at balance date on 31 December 20X6:
Share capital (200,000) shares 200
General reserve 300
Retained earnings 150
(b) Market value of each entity’s shares at 1 January 20X7
ABC Ltd $3.20
XYZ Ltd $4.00
(c) In XYZ Ltd’s accounting records, land was stated at $200,000 below its cost to the group. This is to be accounted for as a consolidation adjustment. Statements of comprehensive income and statements of financial position of ABC Ltd and XYZ Ltd for the year ended 31 December 20X8 are as follows:
Statements of Comprehensive Income
ABC Ltd XYZ Ltd
Sales 5000 2000
Cost of sales 2570 1025
Gross profit 2430 975
Dividend revenue 252 –
Expenses 2057 300
Operating profit before tax 625 675
Income tax expense 280 260
Operating profit after tax 345 415
ABC Ltd XYZ Ltd
Retained earnings at 1.1.X8 294 200
Profit for the year 345 415
Interim dividend paid (100) (150)
Final dividend declared (160) (200)
Retained earnings at 31.12.X8 379 265
Statements of Financial Position
ABC Ltd XYZ Ltd
Other current assets 385 395
Total current assets 385 395
Property, plant and equipment 550 750
Investments 864 –
Total non-current assets 1414 750
Total assets 1799 1145
Trade and other payables 60 180
Provision for final dividend 160 200
Total current liabilities 220 380
Total liabilities 220 380
Net assets 1579 765
Share capital 1200 200
General reserve – 300
Retained earnings 379 265
Total equity 1579 765
(a) ABC Ltd records dividend revenue in the accounting period when the cash is received.
(b) The final dividend declared by XYZ Ltd for the 20X7 year was $130,000 and it was paid on 1 March 20X8.
(c) Impairment losses for goodwill arising on acquisition had not been recognised in any of the previous years’ consolidated financial statements. The directors of ABC Ltd are of the opinion an impairment loss of $10 000 will be recognised in relation to its investment in XYZ Ltd in the consolidated financial statements for the year ended 31 December 20X8.
(d) Inter-company sales for 20X8
Cost Sales Price
From ABC and XYZ $300 000 $500 000
From XYZ to ABC $200 000 $350 000
(e) In relation to the inventory sales in (d) above, inventory held by ABC Ltd and purchased from XYZ Ltd is as follows:
Cost Sales Price
i. As at 1 Jan 2008 $50 000 $120 000
ii. As at 31 Dec 2008 $75 000 $150 000
(f) The rate of company income tax is 30%.
(g) Assume the directors of ABC Ltd have adopted the full goodwill method.
(a) For the accounting records of ABC Ltd show the general journal entries to record:
i. the acquisition of the shares in XYZ Ltd on 1 January 20X7.
ii. the dividend received from XYZ in 20X8 but proposed by XYZ Ltd in 20X7; and
iii. the interim dividend received from XYZ Ltd in 20X8.
(b) Prepare the consolidated financial statements at 31 December 20X8.
Show all consolidation journal entries and a worksheet and all workings for the calculation of NCI.
The consolidated financial statements should be presented in the same manner your textbook presents them.
(c) Explain the partial and the full goodwill methods. In your discussion list the advantages and disadvantages of using each method. (2 marks)
The third movement in the useful was the presume shoe correlation. This movement contrasted from the other two I had done as such far. Rather than recovering footwear marks or dustprint marks my activity was to look at 2 sets of suspect shoes I got for correlation. After close examination I noticed their code as indicated by the FSS coding sheets. The FFS coding sheet holds the data of shoe composes and designs. Utilizing the Bigfoot (a specific arrangement of gear used to take impressions from shoes) I made a print of each shoe and named them fittingly then utilizing a pen I needed to feature the regions of enthusiasm on the Bigfoot prints that were made. At last I analyzed the Bigfoot prints against the Cast which we made amid the principal movement and in addition the ESLA lift created in the second action to see whether any of the sets were the ones which were found in the wrongdoing scene. I was informed that, in actuality, criminological researchers do this to bring up the territories that covered with footwear confirm that was recovered from the wrongdoing scene. Some of the time there are factors that assistance distinguish which shoe compared with the print that was abandoned at the wrongdoing scene these incorporate the measure of the shoe. A portion of the not all that conspicuous highlights turn out to be more obvious after the culmination of the Bigfoot examination. The investigation reveals to you a considerable measure about the kind of individual which wore the shoes for instance exhausted soles demonstrate that the individual wearing the shoes more likely than not completed a ton of strolling. Contorted sole examples emerge because of the weight which is put on them. It is little hints, for example, these which restricted the quantity of suspects down. The last action of this reasonable was the Tool Marks action. What I needed to do here was to look at the UPVC (a material utilized as a part of assembling windows, canals and additionally entryways) areas with the apparatus stamp harm on them. Utilizing silicon throwing unit I made a cast of the imprints and enabled them to dry for roughly 15 minutes before expelling the from the wood. Once the silicon cast had dried I took it and contrasted it with the devices which were recouped from the suspects to check whether any of the instruments coordinated the cast. To distinguish the highlights and example of the instrument stamp and the cast I utilized a magnifier. This sensitive system required a ton of persistence and an enduring hand as it took a while until adjust the apparatuses to the cast anyway once this was done I could affirm which device was utilized to influence the device to check. The last phase of this action was to outline and name the instrument that influenced the device to stamp. The data assembled from the commonsense was arranged and recorded. The classified outcomes would then be utilized by the individual from the encouraging group to think about them against the outcomes the understudies would accumulate. Following the culmination of the viable I was requested that by my director set up a table of results utilizing the PC. This table was to be utilized by the understudies to fill in their got comes about. The table likewise incorporated an arrangement of question which they needed to reply. Amid my second week in the arrangement I was acquainted with the wrongdoing scene house which was additionally arranged on Clifton grounds. The Crime scene house had been set up as of late as It was formally a convenience for postgraduate. It was currently being utilized as a kind of preparing office that reproduced genuine circumstance. The house’s propose was for the understudies to sharpen their examination and recovery abilities and additionally become acclimated to working in a genuine encompassing. The house itself was outfitted with CCTV cameras keeping in mind the end goal to screen the understudies while they were doing different situations. The measurable science division worked firmly together with the Nottinghamshire police as expressed before. The advantages of this was obviously the way that understudies would get exhortation from experienced officers on the most proficient method to manage kill examination, robbery cases and medication looks. My part as a right hand specialist was to set up the house for the suitable movement that would happen. The situation that I was requested to set up was a Drug look action which was planned to happen throughout the week. I was working close by my manager and an individual from the Nottinghamshire police who revealed to me that this action was calm complex in a genuine medication look. In some cases the spots the medications were covered up were unfathomable that is the reason you needed to adopt the thought process of a criminal keeping in mind the end goal to discover them. For wellbeing and security measures the things which were to be utilized for the activity were not genuine medications. Once the medications were altogether set away I returned to the workplaces and outlined a table utilizing Microsoft word which held the data of the various types of medications and hardware that were utilized and the exact area they had been put in the wrongdoing scene house. This was done with a specific end goal to monitor the things the understudies recovered and to recollect which things had been put where in the house. On the next day while the understudies were embraced the Drug seek movement my director and I went into the CCTV room to screen the understudy’s advance. My director acquainted me with the working framework and the distinctive capacities that were essential to control each CCTV independently. After I was OK with working the CCTVs I was left with the errand of checking the activities of the understudies as they were doing the movement. Amid this I needed to note down any activity which conflicted with the implicit rules they had been instructed amid their addresses. When entering a wrongdoing scene it is of most extreme significance that one wears the proper hardware, for example, a defensive suite which covers you from go to toe, gloves and a veil. This is to prevent you from covering the scene with your fingerprints, hair strains or spit follows. A portion of the understudies committed errors, for example, the ones said and it was exactly these demonstrations that I needed to compose done in the log book. While I was watching I saw that a portion of the understudies were recovering the things faster however thus they didn’t discover every one of them. The things they didn’t discover or rather neglected were the things which I set in the more evident areas, for example, far from anyone’s regular field of vision. The others were recovering the things at a slower pace anyway they figured out how to discover every one of them. This featured the way that persistence truly was an ideals. After they had recovered everything the obscure examples of medications were taken back to the lab for testing. The other action which occurred in the wrongdoing scene house towards the finish of the week was the murder scene action. The planning of this movement included utilizing life estimate fakers which looked shockingly genuine. Contingent upon the situation the sham was either male or female. The spurious we utilized that week was the male sham which had cut wrists and in addition an opening throat. It was put in the twofold bed room. Amid this action the understudies needed to analyze the room the “casualty” was found in for fiber follows, footwear and any DNA follows. Once the room was enough looked through the understudies would return to the lab to watch one of the individuals from staff exhibiting how to appropriately transport a carcass. Amid the exhibit it wound up obvious to a great deal of understudies including myself that the vehicle of a body from a wrongdoing scene was not as straight forward as it appeared. Prior to the cadaver was placed in a body pack the appendages must be enclosed by measurable confirmation sacks as they may hold vital bits of proof which could be revealed amid the post-mortem examinations which happen in the criminological labs. I specified before that as a feature of being a right hand specialist I needed to occur in a Health and security talk keeping in mind the end goal to acclimate myself with the day by day perils which included the work environments. The discussion raised some intriguing purposes of about the threats of inconsiderateness amid work or how the courses of action of things could cause major issues amid departure. The discussion’s fundamental concentration was tied in with keeping up a decent work environment constantly. It demonstrated how one could expand their function proficiency by reworking their work area, organizing the things they require arranged by their value at the time. The discussion went ahead to clarify the need of taking short breaks when taking a shot at the PC. The breaks would enable you to remove your look from the screen along these lines facilitating the strain on your eyes. A general dependable guideline is to investigate the separation as this unwinds your ciliary muscles. Moving about amid these little breaks is likewise extremely valuable as it allows you to get up from your seat and stretch your muscles. These couple of basic parts turned out to be an exceptionally valuable arrangement of abilities even now as I’m written work this report. All through the practicals and situations that my administrator, partner and I did, I felt that our cooperation and correspondence continued enhancing to the fact of the matter were it was relatively impeccable. This thusly extraordinarily upgraded the rate of finishing different undertakings and practicals as there was less oversights. Sooner or later I was even ready to assist the understudies with minor specialized troubles of the camera gear. The other major down to earth that I arranged and tried was the Inked Fingerprint reasonable. Fingerprints are taken for a few reasons some of them are: To set up a people character. To see if somebody has a criminal record. On account of relocation the home office takes fingerprints to distinguish whether a man is illicit in the nation. To clear a suspect of perpetrating a wrongdoing. Utilizing fingerprints as confirmation in a court case. The Police utilize them to see if an individual has had any past feelings. This commonsense additionally included a few unique stages which when integrated furnished me with the opportunity to build up a comprehension of the scope of unique finger impression design composes. Likewise while doing this handy my director acquainted me with the system that is included I>