Consolidation Worksheet Entries for Acquisition Analysis

Acquisition Analysis
Particulars Amount
Share Capital $ 120,000
General Reserve $ 25,000
Retained earnings
$
55,000
Fair valuation of assets and liabilities acquired:
- Land $ 21,000
- Inventories $ 5,320
- Machinery $ 2,800
- Brand Name $ 20,300
- Vehicle $ 4,200
$
53,620
Net fair value of assets acquired $ 253,620
Consideration transferred $ 250,000
Gain on Bargain Purchase
$
3,620
Consolidation worksheet entries for the year ended 30 June, 2018
1. Business Combination Valuation Reserve Entries
Brand name recognition at fair value
Brand Name
$
29,000
To Deferred tax liability $ 8,700
To Business Combination valuation reserve $ 20,300
Vehicle recognition at fair value
Accumulated depreciation
$
11,000
To Vehicle $ 5,000
To Deferred tax liability $ 1,800
To Business Combination valuation reserve $ 4,200
Additional depreciation on fair value of vehicle
Depreciation - Vehicle
$
1,000
Retained Earnings (1/7/17)
$
2,000
To Accumulated Depreciation - Vehicle $ 3,000
Deferred tax liability
$
900
To Income tax expense $ 300
To Retained Earnings (1/7/17) $ 600
Recording of Gain on bargain purchase in
BCVR
Business Combination valuation reserve $