1. Prepare the balance sheets of parent ltd and the consolidated balance sheet as at 1 January 20×7 after each transation, using for each qution the balance sheets of parent Ltd and Daughter Ltd as at 1 January 20×7 Which Were as follows
Parent Ltd Daughter Ltd
Ordinary shares of E1 each 40,500 9,000
Retained earnings 4,500 1,800
Cash 20,000 2,000
Other net assets 25,000 8,800
(a)Assume that on 1 January 20×7 parent Ltd acqurent all the ordinary shares in Daughter Ltd for E10,800 cash, the fair value of the net assets in Daughter Ltd was Their book value
(b) The prchacse consideration was satisfied was satisfied by the issue of 5,400 new ordinary shares in parent Ltd, the fair value of a E1 ordinary share in parent Ltd was E2 the fair value of the net assets in Daughter Ltd was their book value.