On 21 April 20X1, Brendon plc purchased 25% of the ordinary shares of Randy plc ...
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On 21 April 20X1, Brendon plc purchased 25% of the ordinary shares of Randy plc for a price of £25,000, obtaining significant influence. At that date, Randy plc’s assets and liabilities were carried at fair value, and its shareholders’ equity comprised share capital of £10,000 and retained earnings of £50,000.
The following information is available about the financial year ending 31 December 20X3:
Brendon
plc received a dividend of £5,000 from Randy plc on 30 March 20X3.
Randy
plc sold goods to Brendon plc for £3,000 on 30 September 20X3. The goods had
cost Randy plc £2,000. One-half of these goods were unsold by Brendon plc at 31
December 20X3.
Randy
plc’s retained earnings amounted to £75,000 at 31 December 20X3.
What is the associate asset reported in Brendon plc’s consolidated statement of financial position on 31 December 20X3?
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