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Task B ( DO NOT SOLVE IN PAPER)

Blueberry PLC and Apple PLC The following are the draft statement of Financial Position of Blueberry PLC and its subsidiary Apple PLC as at 31st December 2020 are given below:

	Blueberry PLC	Apple PLC
Assets	$	$
Non current assets
Tangible assets	480,000	110,000
Investments: Apple PLC	220,000
Current assets
Inventories	219,600	75,600
Trade receivables	290,400	140,700
Cash and cash equivalents	60,000	75,450
Total Assets	1,270,000	401,750
Equity and liabilities
Share capital :Ordinary $1 shares	750,000	150,000
Share premium	-	18,750
Retained earnings	96,000	80,000
Non- current liabilities:
Loan	79,000	60,000
Current liabilities
Trade and other payables	345,000	93,000
Total Equity & Liabilities	1,270,000	401,750

Additional information:

1. Blueberry PLC acquired 120,000 shares in Apple PLC on 1st Jan 2020 for a cost of $ 220,000 when the retained earnings of Apple PLC were $ 30,000. The fair value of the non-controlling interest in Apple PLC at the date of acquisition was $43,500.

2. At the date of acquisition, the fair value of the net assets of Apple PLC approximated their carrying amounts, except for a plot of land owned by Apple PLC. This land was held in the financial statements of Apple PLC at its cost of $45,000 but was estimated to have a fair value of $90,000. This land is still owned by Apple PLC at 31st December 2020.

3. On 31st December 2020 Apple PLC sold goods to Blueberry PLC for $ 15,000 at a margin of 20%. One Quarter of these goods were still unsold by Blueberry PLC at the end of the year.

4. At 31st December 2020 Apple PLC s trade receivables include $ 84,000 due from Blueberry PLC and Blueberry PLCs trade payable include $ 84,000 due to Apple PLC.

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