jadual

Exercise 1
MawiWorld Sdn Bhd acquired the shares in E-Keen Sdn Bhd on 1 October 2007 for RM359,450 when E-Keen Sdn Bhd’s profit and loss and capital reserve were RM30,600 and RM20,000 respectively.
Balance Sheets as 30 September 2008

MawiWorld Sdn Bhd
E-Keen Sdn Bhd

RM
RM
RM
RM
Non current assets

Property

200,000

270,000
Plant and machinery (net book value)

203,000

260,000

Investments in E-Keens Sdn Bhd

225,000 ordinary shares

281,450

25,000 6% preference shares

58,000

RM20,000 10% debentures

20,000

Current assets

Inventories
25,000

30,000

Account receivable
45,000

35,000

Bills receivable
14,000

18,000

Current account – E-Keen
25,000

Bank
46,550
155,550
46,700
129,700

918,000

659,700

Shareholders’ equity

Ordinary share capital of RM1.00 each

500,000

300,000
6% preference share capital of RM2.00 each

-

100,000
Capital reserve

120,000

25,000
Profit and loss

180,000

120,000

Non current liabilities

10% debentures

40,000

30,000

Current Liabilities

Accounts payable
40,000

50,000

Bills payable
15,000

8,000

Preference dividend payable
-

4,200

Ordinary dividend payable
21,000

21,000

Debenture interest
2,000
78,000
1,500
84,700

918,000

659,700

Additional information:
1. On 15 October 2007, E-Keen Sdn Bhd declared a 6% ordinary dividend which was duly recorded in the profit and loss account of MawiWorld Sdn Bhd
2. During the year, MawiWorld Sdn Bhd invoiced goods to E-Keen Sdn Bhd at RM25,000. MawiWorld Sdn Bhd charges the standard mark up of 25% on cost for all its sales. E-Keen Sdn Bhd had not received the goods and therefore did not include it in the year end inventory, nor had it received the invoice for the goods
3. Provision is to be made for half year debenture interest accrued for the year