MANAGEMENT ACCOUNTING PROCESS 2022

Running head: INTRODUCTION TO MANAGEMENT ACCOUNTING
Introduction to Management Accounting
Name of the Student:
Name of the University:
Author Note

1INTRODUCTION TO MANAGEMENT ACCOUNTING
Table of Contents
1. Preparing the acquisition analysis at acquisition date:...........................................................2
2. Preparing the business combination valuation entries and pre-acquisition entry at
acquisition date:.........................................................................................................................2
3. Preparing the journal entry to recognise NCI at acquisition date:.........................................4
4. Preparing the consolidation worksheet entries at 30 June 2020, while assuming a profit for
the year of $81,000:....................................................................................................................4
5. Explaining the step by providing the full goodwill method:..................................................5
References and Bibliography:....................................................................................................6

2INTRODUCTION TO MANAGEMENT ACCOUNTING
1. Preparing the acquisition analysis at acquisition date:
Acquisition Analysis at July 2019
Particulars Value
Inventories 308,308
Land 617,253
Vehicle 719,810
Fittings 6,338
Liabilities (Contingent) 31,850
Share capital 1,285,830
General reserve 550,550
Asset revaluation surplus 440,440
Net fair value 3,960,379
Consideration
transferred 4,036,000
Goodwill paid 75,621
The information in the above table provides highlight on the acquisition analysis at
July 2019, which is conducted for detecting the level of valuation that is associated with the
acquisition process of Davis Ltd. In addition, the calculations have indicated that the overall
net fair value of the assets that is acquired by Ethan Ltd of Davis Ltd is at the levels of
3,960,379. However, Ethan Ltd has provided a consideration amount of 4,036,000, which
makes the total goodwill paid by Ethan Ltd at 75,621 (Bisogno, Santis and Tommasetti
2015).
2. Preparing the business combination valuation entries and pre-acquisition entry at
acquisition date:
WORKSHOP ENTRIES AT 30 JUNE, 2020
Business combination value entries
Particulars Amount Amount
Goodwill.....................Dr 75,621
BCVR 75,621
Inventories...............Dr 440,440
Income tax expense 132,132
Transfer from BCVR 308,308