Set out below are the financial statements of Ant Co., its subsidiary Bug Co. and an associated company Nit Co. for the accounting year-end 31 December 20X9.
Statements of financial position as at 31 December 20X9
| Ant | Bug | Nit | |
| $ | $ | $ | |
| ASSETS | |||
| Non-cur rent assets | |||
| Property, plant and equipment at cost | 240,000 | 135,000 | 75,000 |
| Depreciation | 150,000 | 52,500 | 15,750 |
| 90,000 | 82,500 | 59,250 | |
| Investment in Bug | 90,000 | ||
| Investment in Nit | 30,000 | ||
| Current assets | |||
| Inventories | 105,000 | 45,000 | 27,000 |
| Trade receivables | 98,250 | 52,500 | 27,000 |
| Current account – Bug | 11,250 | ||
| Current account – Nit | 2,250 | ||
| Bank | 17,250 | 5,250 | 4,500 |
| Total current assets | 234,000 | 102,750 | 58,500 |
| Total assets | 444,000 | 185,250 | 117,750 |
| EQUITY AND LIABILITIES | |||
| $1 ordinary shares | 187,500 | 45,000 | 37,500 |
| General reserve | 22,500 | 15,000 | 9,000 |
| Retained earnings | 112,500 | 90,000 | 37,500 |
| 322,500 | 150,000 | 84,000 | |
| Current liabilities | |||
| Trade payables | 99,000 | 18,750 | 25,500 |
| Taxation payable | 22,500 | 5,250 | 6,000 |
| Current account – Ant | 11,250 | 2,250 | |
| Total equity and liabilities | 444,000 | 185,250 | 117,750 |
Statements of comprehensive income for the year ended 31 December 20X9
| $ | $ | $ | |
| Sales | 225,000 | 120,000 | 75,000 |
| Cost of sales | 67,500 | 60,000 | 30,000 |
| Gross profit | 157,500 | 60,000 | 45,000 |
| Expenses | 70,500 | 37,500 | 30,000 |
| Dividends received | 7,500 | NIL | 7,500 |
| Profit before tax | 94,500 | 22,500 | 22,500 |
| Taxation | 22,500 | 5,250 | 6,000 |
| Profit for the year | 72,000 | 17,250 | 16,500 |
| Dividends paid in year | 30,000 | 7,500 | 6,000 |
Ant Co. acquired 80% of the shares in Bug Co. on 1 January 20X7 when the balance on the retained earnings of Bug Co. was $45,000 and the balance on the general reserve of Bug Co. was $12,000. The fair value of the non-controlling interest in Bug on 1 January 20X7 was £21,000. Group policy is to measure non-controlling interests using method 2. Ant Co. also acquired 25% of the shares in Nit Co. on 1 January 20X8 when the balance on Nit’s retained earnings was $22,500 and the general reserve $6,000.
During the year Ant Co. sold Bug Co. goods for $12,000, which included a mark-up of one-third. 90% of these goods were still in inventor y at the end of the year.
Required:
(a) Prepare a consolidated statement of comprehensive income for the year ending 31/12/20X9, including the associated company Nit’s results.
(b) Prepare a consolidated statement of financial position at 31/12/20X9, including the associated company.
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