Posted: October 28th, 2022

ACCT accounting Allteck Building Ltd (“Allteck”) build luxury homes. In an attempt

Allteck Building Ltd (“Allteck”) build luxury homes. In an attempt to vertically integrate theirbusiness, they acquired all of the shares of Landfry Ltd (“Landfry”) on 1 July 2016 on an exdividend basis. Due to a downturn in the property market, Landfry made a loss in the prioryear for the first time. Legal and accounting fees related to the acquisition totalled $11000.On 1 July 2016, Landfry had the following in its balance sheet;Share capitalGeneral ReserveRetained earnings/(losses)Dividends PayablePlantTrademarkLand inventoryBuilding premisesGoodwill$100,000$750,000($135,000)$10,000$275,000 (carrying amount of $85,000)$50,000$2,500,000$600,000 (carrying amount of $120,000)$20,000Fair value of $65,000Fair value of $60,000Fair value of $2,900,000Fair value of $850,000Fair value of Nil2016/2017 impairment testing reduces the carrying value of goodwill to $10,000. Thebuilding premises and plant are being depreciated on a straight-line basis over 20 years and10 years respectively. The building was acquired on 1 Jan 2001 and the plant has a further 3years of depreciation remaining. The trademark is considered to have an indefinitely life.Landfry currently has a legal dispute with a customer who claims that they were not advisedof problems with the title of some land. They are suing Landfry for $350,000 and thedirectors believed there was a 35% chance of success at that stage. This was settled on15/5/18 for $80000.All of the inventory was sold in the 2016 year.Additional informationa) The business turned around and on 1/3/18, Landfry was able to pay a $30,000dividend. Shareholder approval is not required in relation to payment ofdividends.b) On 1/1/17, a parcel of land costing Landfry $450,000 on 30 Nov 2016 was sold toAllteck for $620,000 to build a display home. It is not expected that this land willbe sold in the immediate future.c) On 30/06/17, Allteck sold a motor vehicle to Landfry for $50,000 for use by oneits staff. The vehicle cost Allteck $80,000 in Jan 2017 and it had a carrying valueof $65,000 at the date of sale. The M/V was being depreciated on a straight linebasis over 5 years.d) During the 2017/2018 year, Landfry began selling some of the land acquired inJan 2018 to Allteck to include as a home and land package. There were twoblocks sold during the year, which cost Landfry $300,000 and $380,000. Theywere sold to Allteck at a 15% margin. Only the first block was sold before 30June 2018 with Allteck recording the other block as part of their work in progressinventory. As at 30 June 2018, Allteck have not yet paid Landfry for the $300,000block and it is expected to be paid in July 2018.e) Landfry was running low on cash and borrowed $500,000 from Allteck on1/3/18. Interest of 5% payable monthly was charged and paid. The loan waspartly paid back on 1/5/18 when Landfry issued $50,000 worth of additionalshares to Allteck.f) The tax rate is 30%The trial balances of both companies as at 30 June 2018 is as follows;RequiredUsing Excel, prepare the consolidation worksheet for the year ended 30 th June 2018. You are notrequired to complete the consolidated financial statements so your final result should be aconsolidated trial balance. Please Include narrations and details of all of your journals and excelformulae (refer to submission guidelines)

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