tax assignment代写

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  • Required
    Prepare the following:
    1.  Acquisition analysis at 1 July 2009.
     
    According to the formula:
    Net FV of identifiable assets and liabilities of subsidiary
    =    recorded equity [capital + reserves] of subsidiary
       + differences between CA & FV of each recorded asset & liability after tax  
    + FV of each unrecorded asset, liability and contingent liability recognized as part of the business combination after tax
     
     
    Recorded equity [capital + reserves] of subsidiary:
    Share Capital  $180, 000
    General Reserve  $20, 000
    Plant Maintenance Reserve  $30, 000
    Retained Earnings  $72, 000
    Subtotal: $302,000
     
    Differences between CA & FV of each recorded asset & liability after tax:
    Land               $75, 000-$50,000=$25,000
    Building            $57, 000-$55,000=$2,000
    Inventory           $60, 000-$45,000=$15,000
    Plant               $190,000-$182,000=$8,000
    Delivery Truck       $38, 000-$36,000=$2,000
    Subtotal: $52,000 (1-30%) =$36,400
     
    FV of each unrecorded asset, liability and contingent liability recognized after tax:
    Unrecorded patent:  $45,000
    Court case:          ($30,000)
    Subtotal: $15,000 (1-30%) =$10,500
     
    So, the Net FV of identifiable assets and liabilities of subsidiary is $348,900. So the consideration transferred is 360,000, so the goodwill is $11,100.
     
     
    2.  The BCVR & pre-acquisition worksheet journal entries ONLY at 30 June 2012.
    BCVR entries at 30 June 2012:
    1) Land                       Dr  25,000
        Deferred tax liability                     Cr    7,500
    BCV reserve                            Cr    17,500
     
    2) Accumulated depreciation       Dr  (75,000-55,000)=20,000
        Building                                Cr    18,000
        Deferred tax liability                     Cr     600
        BCV reserve                            Cr    1,400
     
    Depreciation expense            Dr  200
    Retained earnings               Dr  400
    Accumulated depreciation               Cr    600
    (10% x $2000 x 3 of difference between FV and CA)
     
    Deferred tax liability              Dr  180
    Income tax expense                     Cr    60
    Retained earnings                       Cr  120
    (30% x $600 Dep. Expense)
     
    3) Cost of sales                  Dr  15,000
    Income tax expense                    Cr   4,500
    BCV reserve                           Cr   10,500
    (Inventory was sold during 2010)
     
    4) Accumulated depreciation       Dr  (260,000-182,000)=78,000
         Plant                                  Cr    70,000
         Deferred tax liability                    Cr    2,400
    BCV reserve                           Cr    5,600
     
    Depreciation expense            Dr  1,600
    Retained earnings               Dr  3,200
    Accumulated depreciation               Cr    4,800
    (20% x $8000 x 3 of difference between FV and CA)
     
    Deferred tax liability              Dr  1,440
    Income tax expense                     Cr    480
    Retained earnings                       Cr    960
    (30% x $4,800 Dep. Expense)
     
    5) Accumulated depreciation       Dr  (90,000-36,000)=54,000
         Delivery truck                          Cr    52,000
         Deferred tax liability                    Cr    600
    BCV reserve                           Cr    1,400
     
    Deprec. Expense                      Dr      375
    Carrying amount of delivery truck sold  Dr      850
    Income Tax Expense                           Cr     525
    Retained Earnings                  Dr    700
    Transfer from BCV reserve                  Cr   1,400
     
    For calculation:
    Depreciation expense           Dr  375
    Retained earnings              Dr  1000
             Accumulated depreciation               Cr    1,375
    (25% x $2,000 x 9 months difference between FV and CA)
    Deferred tax liability            Dr  412.5
    Income tax expense                     Cr    112.5
    Retained earnings                       Cr    300
    (30% x $1000 Dep. Expense) 
    Deferred tax liability            Dr  412.5
    Income tax expense                     Cr    412.5
    (Truck sold in 2012)
     
     
    6) Unrecorded patent
    Goodwill                       Dr  45,000
        Deferred tax liability                  Cr    13,500
      BCV reserve                         Cr    31,500
     
    7) Unrecorded court case
    Deferred tax liability                  Dr     9,000
    BCV reserve                         Dr    21,000
    Damage expense              Cr  30,000
    8) Goodwill                           Dr  11,100 
             BCV reserve                       Cr    11,100
     
    Pre-acquisition entries at 30 June 2012:
     
    1Pre-acquisition entry for reserve transfer
    In Napoli company:
    Transfer to general reserves      Dr  10,000
    General reserve                     Cr    10,000
     
    Gneral reserves      Dr  10,000
    Transfer to general reserve          Cr    10,000
     
    2Pre-acquisition entry for general reserve
    Retained earnings          Dr  62,000
    Share capital               Dr  180,000
    General reserve            Dr   30,000
    Plant Maintenance Reserve  Dr  30, 000
    BCVR                     Dr   58,000
    Shares in Napoli Ltd         Cr    360,000
     
     
     
    3.  All of the consolidation worksheet journal entries at 30 June 2013.
     
    BCVR entries at 30 June 2013:
    1) Accumulated depreciation       Dr  (75,000-55,000)=20,000
        Building                                Cr    18,000
        Deferred tax liability                     Cr     600
        BCV reserve                            Cr    1,400
     
    Depreciation expense            Dr  200
    Retained earnings               Dr  600
    Accumulated depreciation               Cr    800
    (10% x $2000 x 4 of difference between FV and CA)
     
    Deferred tax liability              Dr  240
    Income tax expense                     Cr    60
    Retained earnings                       Cr  180
    (30% x $800 Dep. Expense)
     
    2) Accumulated depreciation       Dr  (260,000-182,000)=78,000
         Plant                                  Cr    70,000
         Deferred tax liability                    Cr    2,400
    BCV reserve                           Cr    5,600
     
    Depreciation expense            Dr  1,600
    Retained earnings               Dr  4,800
    Accumulated depreciation               Cr    6,400
    (20% x $8000 x 4 of difference between FV and CA)
     
    Deferred tax liability              Dr  1,920
    Income tax expense                     Cr    480
    Retained earnings                       Cr    1,440
    (30% x $6,400 Dep. Expense)
    3) 2013-1-1, Napoli sold patent
     
    Other revenues             Dr 30,000
       Goodwill                    Cr 28,000
    BCV reverse                 Cr 2,000
     
    Deferred tax asset            Dr  9,000
    Income tax expense                 Cr    9,000
     
    4) Court case
     
    Damage expense            Dr 34,000
       Transfer from BCV             Cr 21,000 
    Income tax expense            Cr    9000
    Retained earnings              Cr    4000
     
    5)
    Impairment expense    Dr  5,000
      Accumulated Impairment Losses  Cr  5,000
     
    Pre-acquisition entries at 30 June 2013: No entry
     
     
    Intra-group transactions:
    1) On 2012-7-1, Roma transferred inventory to Napoli:
    Sales                   Dr  28,000
    Cost of sales                Cr    28,000
     
    2) On 2011-4-1, Roma sold inventory to Napoli
    Sales                   Dr  25,000
    Cost of sales                Cr    27,000
    Inventory                   Cr     -2,000
     
    Deferred tax asset       Dr  -600
    Income tax expense         Cr    -600
     
    Depreciation expense           Dr  11,250
    Accumulated depreciation               Cr    11,250
     
    Deferred tax asset              Dr  3,375
    Income tax expense                     Cr    3,375
     
    3) 2013-6-30, Roma sold inventory to Napoli, Napoli sold to external:
    Sales                   Dr  27,000
    Cost of sales                Cr    24,000
    Inventory                   Cr     3,000
     
    Deferred tax asset       Dr  900
    Income tax expense         Cr    900
     
    4) 2011-5-1, Roma lent to Napoli:
    Loan from Roma Ltd                   Dr  35,000
    Loan to Napoli Ltd                       Cr    35,000
    Loan reveivable-Napoli                 Dr  2,800
    Loan payable-Roma                      Cr    2,800
     
    5) 2012-10-1, Napoli sold plant to Roma
     
    Proceeds on sale             Dr  14,000
    Available for sale                   Cr    11,000
    Plant                               Cr     3,000
     
    Deferred tax asset            Dr  180
    Income tax expense                 Cr    180
     
    6) 2013-1-1, Roma sold furniture to Napoli
     
    Proceeds on sale             Dr  5,000
    Available for sale                  Cr    4,500
    Office furniture                     Cr      500
     
    Deferred tax asset            Dr  150
    Income tax expense                 Cr    150
     
    Depreciation expense         Dr    350
    Accumulated depreciation          Cr  350
     
    (450 for Group, 300 for Roma 3 months, 500 for Napoli 6 months, the adjustment is 500+300-450)
     
    4.  The consolidation worksheet for Roma Ltd at 30 June 2013. 
    Account Name Roma Ltd Napoli Ltd Adjustments Group
        Dr Cr    
    Cash 90620.00 96145.00         186765.00
    Receivables 36000.00 83800.00         119800.00
    Dividend Receivable 8000.00 1200.00         9200.00
    Inventory 72000.00 97800.00     -2000   171800.00
              3000   -3000.00
    Available-for-Sale -Financial assets 90250.00 27250.00         117500.00
    Loan Receivable – Napoli Ltd 35000.00     35000     70000.00
            2800     2800.00
    Shares in Napoli Ltd 360000.00           360000.00
    Deferred Tax Assets 32080.00 24725.00         56805.00
    Land 125000.00 50000.00         175000.00
    Buildings 120000.00 75000.00     18000   177000.00
    Plant 450000.00 320000.00     70000   700000.00
    Delivery Truck 75000.00 120000.00         195000.00
    Office Furniture 15000.00 26000.00         41000.00
    Goodwill 28000.00       28000   0.00
    Cost of Sales 1440100.00 1190500.00     28000   2602600.00
              27000   -27000.00
              24000   -24000.00
    Proceeds on sale       14000     14000.00
            5000     5000.00
    Amortisation & Depreciation 60000.00 59100.00   200     119300.00
            1600     1600.00
            11250     11250.00
            350     350.00
    Damages Expense   34000.00   34000     68000.00
    Other expenses 63000.00 162400.00         225400.00
    Income tax expense 68100.00 79860.00     480   147480.00
              9000   -9000.00
              9000   -9000.00
              -600   600.00
              3375   -3375.00
              900   -900.00
              180   -180.00
              150   -150.00
    Impairment expense       5000     5000.00
    Dividend paid 12000.00 10000.00         22000.00
    Dividend declared 6000.00 8000.00         14000.00
    Transfer to General Reserve 10000.00           10000.00
    Total Debit Balances 3196150.00 2465780.00   109200 218485   5552645.00
                   
                   
    Account Name Roma Ltd Napoli Ltd Adjustments Group
        Dr Cr    
                   
    Share Capital 450000.00 180000.00         630000.00
    General Reserve 80000.00 30000.00         110000.00
    Plant Maintenance Reserve   10000.00         10000.00
    Available for sale - FA Reserve 40000.00 5000.00         45000.00
    Retained Earnings (1/7/12) 89500.00 165340.00   600 1440   255680.00
            4800 4000   -800.00
    Dividend Payable 6000.00 8000.00         14000.00
    Accounts Payable 37000.00 31400.00         68400.00
    Loan Payable – Roma Ltd   35000.00     35000   70000.00
              2800   2800.00
    Loan Payable (due 1/7/16) 100000.00 50000.00         150000.00
    Current Tax Liability 65200.00 89000.00         154200.00
    Deferred Tax Liability 19250.00 26040.00   1920 600   43970.00
            9000 2400   -6600.00
            -600     600.00
            3375     -3375.00
            900     -900.00
            180     -180.00
            150     -150.00
    Annual Leave Entitlements 50000.00 25000.00         75000.00
    Sales Revenue 1830000.00 1500000.00   28000     3302000.00
            25000     -25000.00
            27000     -27000.00
    Available for sale         11000   11000.00
              4500   4500.00
    Dividend Revenue 23500.00 3200.00         26700.00
    Gain on Sale of NCA 500.00 50000.00         50500.00
    Other Revenue 62900.00 16000.00   30000     48900.00
    Transfer from PMR   20000.00         20000.00
    Accum. Depreciation –Buildings 56000.00 40000.00   20000 800   76800.00
    Accum. Depreciation –Plant 252000.00 153000.00   78000 6400   333400.00
              11250   11250.00
              3000   3000.00
    Accum Depreciation –Office Furniture 6200.00 13800.00     350   20350.00
              500   500.00
    Accum. Depreciation – Delivery Truck 28100.00 15000.00         43100.00
    Accum. Impairment loss         5000   5000.00
    BCR Reverse         1400   1400.00
              5600   5600.00
              2000   2000.00
    Transfer from BCR         21000   21000.00
    Total Credit Balances 3196150.00 2465780.00   228325 119040   5552645.00
     
     
    5.  The consolidated financial statements for Roma Ltd at 30 June 2013.
    Account Name Group Account Name Group
    Current Assets   Equity  
    Cash 186765.00 Share Capital 630000.00
    Receivables 119800.00 General Reserve 110000.00
    Dividend Receivable 9200.00 Plant Maintenance Reserve 10000.00
    Inventory 168800.00 Available for sale - FA Reserve 45000.00
    Available-for-Sale -Financial assets 117500.00 Retained Earnings (1/7/12) 254880.00
    Loan Receivable – Napoli Ltd 72800.00 BCR Reverse 9000.00
    Shares in Napoli Ltd 360000.00 Transfer from BCR 21000.00
    Deferred Tax Assets 56805.00 Profit 248625.00
    Fixed Assets   Total Equity 1328505.00
    Land 175000.00    
    Buildings 177000.00 Liability  
    Plant 700000.00 Dividend Payable 14000.00
    Delivery Truck 195000.00 Accounts Payable 68400.00
    Office Furniture 41000.00 Loan Payable – Roma Ltd 72800.00
    Transfer to General Reserve 10000.00 Loan Payable (due 1/7/16) 150000.00
        Current Tax Liability 154200.00
        Deferred Tax Liability 33365.00
        Annual Leave Entitlements 75000.00
        Accum. Depreciation –Buildings 76800.00
        Accum. Depreciation –Plant 347650.00
        Accum Depreciation –Office Furniture 20850.00
        Accum. Depreciation – Delivery Truck 43100.00
        Accum. Impairment loss 5000.00
    Total Assets 2389670.00 Total Liability 1061165.00
     
     
    Revenue  
    Sales Revenue 3250000.00
    Available for sale 15500.00
       
    Cost of goods sold  
    Cost of Sales 2551600.00
    Proceeds on sale 19000.00
       
    Other expenses  
    Amortisation & Depreciation 132500.00
    Damages Expense 68000.00
    Other expenses 225400.00
    Income tax expense 125475.00
    Impairment expense 5000.00
    Dividend paid 22000.00
    Dividend declared 14000.00
       
    Other Revenue  
    Dividend Revenue 26700.00
    Gain on Sale of NCA 50500.00
    Other Revenue 48900.00
    Transfer from PMR 20000.00
       
    Net Income 248625.00