Managerial Accounting Consolidation Worksheet

This document is a consolidation worksheet for managerial accounting. It includes calculations for the net fair value of identifiable assets and liabilities of Glider Ltd, as well as the calculation of tax on inventory, patent, and plant. It also includes entries for the valuation of business combination and pre-acquisition, as well as profit and sales in closing inventory. The document concludes with a consolidated financial statement, including an income statement and balance sheet.

Managerial accounting-
consolidation worksheet

Consolidation worksheet with calculation
Calculation for Net fair value of identifiable assess and liabilities of Glider Ltd:
Particulars Amount
Equities 72000
(66000+6000)
Inventory 4500
Patent 15000
Plant 3000
Total fair value 94500
3150+10500+2100
Calculation of tax on Inventory, patent and plan @ 30%
Particulars Amount
Inventory 4500
Less: tax @ 30% 1350
Net inventory 3150
Patent 15000
Less: tax @ 30% 4500
Net value of Patent 10500
Plant 3000
Less: tax @ 30% 900
Net value of plant 2100
Net fair value: 72000+3150+10500+2100
=87750
Value of good will =2250
1

Transferred consideration =90000
Entries of valuation of business combination (A):
Particulars Amount
Dr. Cr.
Accumulated Dep. Dr 30000
To Plant 27000
To deferred tax liability 900
To Business combination reserve 2100
Dep exp. Dr. 600
Retained earnings as on 1 July 2016 Dr. 600
To Acc. Dep. 1200
Deferred Tax liabilities Dr. 360
To Retained earnings as on 1 July 2016 Dr. 180
To Income tax 180
Goodwill Dr. 2250
To business combination reserve 2250
Entries related to pre acquisition (B):
Date Particulars Amount
Dr. Cr.
1-July-2015 Share capital Dr. 66000
Retained earning Dr. 6000
Business combination reserve Dr. 15000
2

Glider's Share 90000
30-June-2017 Share capital Dr. 66000
Business combination reserve Dr. 4350
Retained earnings Dr. (6000+3000+10500) 19650
Glider's Share 90000
Profit and sales in closing inventory (C):
Particulars Amount
Dr. Cr.
Sales Dr. 21000
Cost of sales 21000
Sales Dr. 4500
Inventory 300
Cost of sales 4200
Deferred tax assets Dr. 90
Income tax 90
Profit and sales in opening inventory in Glider (D):
Particulars Amount
Dr. Cr.
Retained earning as on 1st July 2016 Dr. 420
Income tax Dr. 180
Cost of sales 600
Sale of plant current period (E):
3

Particulars Amount
Dr. Cr.
Receipts from sales of plant Dr. 15000
Plant 1000
Carrying amount of sold plant 14000
Income tax 30
Deferred tax assets 30
Deferred tax assets Dr. 300
Income tax 300
Acc. Dep. of plant 100
Dep. 100
Sale of inventory (Plant) previous period (F):
Particulars Amount
Dr. Cr.
Deferred tax assets Dr. 600
Retained earnings as on 1st July 2016 Dr. 1400
Plant 2000
Accumulated Dep Dr. 1000
Dep Exp. 400
Retained earnings as on 1st July 2016
(2000*20%*1.5)
600
4

Income tax Dr. 120
Retained earnings as on 1st July 2016 Dr. 180
Deferred tax assets 300
Sale of plant (Inventory) current period (G):
Particulars Amount
Dr. Cr.
Receipts from sales of plant Dr. 9000
Carrying amount of sold plant 7500
Cost of sales 1500
Consolidated financial statement
Income statement:
Particulars Fluffy
Ltd.
Glider
Ltd.
Adjustment Group
Dr. Cr.
Sales 64500 78000 21000 (C)
4500 (C)
- 117000
Cost of sales 30900 46350 - 21000 (C)
4200 (C)
600 (D)
1500 (G)
49950
G.P. 33600 31650 - - 67050
Office exp. 7950 4050 - - 12000
Trading exp. 4800 9000 13800
Dep. 1800 3900 600 (A) 100 (E)
400 (F)
5800
Trading profit 19050 14700 - - 35450
5

Receipts from sales of plant 9000 15000 15000 (E)
9000 (G)
Nil
Carrying amount of sold plant 7500 14000 14000 (E)
7500 (G)
Nil
Profit or loss 1500 1000 - - Nil
PBT 20550 15700 - - 38450
Less tax 11100 7300 180 (D)
30 (E)
120 (F)
180 (A)
90 (C)
300 (E)
18160
Net profit after tax 9450 8400 - - 17290
Balance sheet:
Liabilities and Assets Fluffy
Ltd.
Glider
Ltd.
Adjustment Group
Dr. Cr.
Retained earnings as on 1st July 2016 48000 31500 600 (A)
19650 (B)
420 (D)
1400 (F)
60 (F)
180 (A)
200 (F)
57750
Retained earnings as on 30 June 2017 57450 39900 - - 75040
Capital 96000 66000 66000 (B) - 96000
Business consolidation reserve - - 4350 (B) 2100 (A)
2250 (A)
Nil
Equities 153450 105900 - - 171040
Deferred Tax liabilities 11000 15000 360 (A) 900 (A) 26540
Current liabilities 21100 10500 - - 31600
Total liabilities 32100 25500 - - 58140
Overall liabilities and equities 185550 131400 - - 229180
6

Good will 0 0 2250 (A) - 2250
Inventory 28500 24600 - 300 (C) 52800
Receivables 8250 12450 - - 2700
Plant 57000 107250 - 27000 (A)
1000 (E)
2000 (F)
134250
Acc. Dep. -18300 -33450 30000 (A)
100 (E)
600 (F)
1200 (A) -22250
Glider' Shares 90000 - - 90000 Nil
Deferred tax assets 8100 9450 90 (C)
300 (E)
600 (F)
30 (E)
180 (F)
18330
Intangible assets 12000 11100 - - 23100
Total Assets 18550 131400 177210 177210 229180
7