Question

QUESTION ONE Eagle, Heron \& Sparrow On 1 October 2016 Eagle plc acquired, for Tzs 316,000,000; 80,000 Tzs 1,000 ordinary shares in Heron Ltd. The profit and loss reserves at the date of acquisition totalled Tzs \( 250,000,000 \). On 30 September 2010 Eagle plc acquired, for Tzs 47,000,000; 20,000 Tzs 1000 ordinary shares in Sparrow Ltd. The profit and loss reserves at the date of acquisition totalled Tzs \( 35,000,000 \). Summarised balance sheets at 30 September 2022, and profit and loss accounts for the year ended on that date were as follows: \begin{tabular}{|c|c|c|c|} \hline & \begin{tabular}{l} Eagle plc \\ Tzs '000' \end{tabular} & \begin{tabular}{l} Heron Ltd \\ Tzs '000' \end{tabular} & \begin{tabular}{l} Sparrow Ltd \\ Tzs '000' \end{tabular} \\ \hline \multicolumn{4}{|l|}{ Profit \& loss accounts } \\ \hline Operating profit & 147,000 & 54,000 & 51,000 \\ \hline Interest & \( \underline{(20,000)} \) & \( (5,000) \) & \( \underline{(4,000)} \) \\ \hline Profit before tax & 127,000 & 49,000 & 47,000 \\ \hline Taxation & \( (42,000) \) & \( (23,000) \) & \( (15,000) \) \\ \hline Profit for the year & \( \underline{85,000} \) & \( \underline{26,000} \) & \( \underline{32,000} \) \\ \hline \multicolumn{4}{|l|}{ Balance sheets } \\ \hline Subsidiary & 316,000 & - & - \\ \hline Associate & 47,000 & - & - \\ \hline \multirow[t]{2}{}{ Other net assets } & \( \underline{308,000} \) & \( \underline{441,000} \) & \( \underline{128,000} \) \\ \hline & \( \underline{671,000} \) & 441.000 & \( \underline{128,000} \) \\ \hline Share capital & 220,000 & 100,000 & 50,000 \\ \hline \multirow[t]{2}{}{ Profit \& loss reserves } & \( \underline{451,000} \) & \( \underline{341,000} \) & \( \underline{78,000} \) \\ \hline & 671.000 & 441,000 & 128.000 \\ \hline \end{tabular} 1. Following an impairment review of goodwill in 2023 , Tzs \( 9,000,000 \) of the goodwill relating to Heron was written off. 2. Heron did not pay any dividends during the year to 30 September 2023. Sparrow paid a dividend of Tzs 10,000,000 in 2023 . 3. Eagle includes dividends received in operating profit. 2 4. During the year to 30 September 2023 Sparrow sold goods to Eagle for Tzs \( 40,000,000 \). These goods had cost Sparrow Tzs 33,500,000. At 30 September 2023 Eagle had 25\% of these goods in stock. Required: Prepare the Eagle plc's consolidated profit and loss account and consolidated balance sheet for the year ended 30 September 2023

          QUESTION ONE
Eagle, Heron \& Sparrow
On 1 October 2016 Eagle plc acquired, for Tzs 316,000,000; 80,000 Tzs 1,000 ordinary shares in Heron Ltd. The profit and loss reserves at the date of acquisition totalled Tzs \( 250,000,000 \).

On 30 September 2010 Eagle plc acquired, for Tzs 47,000,000; 20,000 Tzs 1000 ordinary shares in Sparrow Ltd. The profit and loss reserves at the date of acquisition totalled Tzs \( 35,000,000 \).

Summarised balance sheets at 30 September 2022, and profit and loss accounts for the year ended on that date were as follows:
\begin{tabular}{|c|c|c|c|}
\hline & \begin{tabular}{l} 
Eagle plc \\
Tzs '000'
\end{tabular} & \begin{tabular}{l} 
Heron Ltd \\
Tzs '000'
\end{tabular} & \begin{tabular}{l} 
Sparrow Ltd \\
Tzs '000'
\end{tabular} \\
\hline \multicolumn{4}{|l|}{ Profit \& loss accounts } \\
\hline Operating profit & 147,000 & 54,000 & 51,000 \\
\hline Interest & \( \underline{(20,000)} \) & \( (5,000) \) & \( \underline{(4,000)} \) \\
\hline Profit before tax & 127,000 & 49,000 & 47,000 \\
\hline Taxation & \( (42,000) \) & \( (23,000) \) & \( (15,000) \) \\
\hline Profit for the year & \( \underline{85,000} \) & \( \underline{26,000} \) & \( \underline{32,000} \) \\
\hline \multicolumn{4}{|l|}{ Balance sheets } \\
\hline Subsidiary & 316,000 & - & - \\
\hline Associate & 47,000 & - & - \\
\hline \multirow[t]{2}{*}{ Other net assets } & \( \underline{308,000} \) & \( \underline{441,000} \) & \( \underline{128,000} \) \\
\hline & \( \underline{671,000} \) & 441.000 & \( \underline{128,000} \) \\
\hline Share capital & 220,000 & 100,000 & 50,000 \\
\hline \multirow[t]{2}{*}{ Profit \& loss reserves } & \( \underline{451,000} \) & \( \underline{341,000} \) & \( \underline{78,000} \) \\
\hline & 671.000 & 441,000 & 128.000 \\
\hline
\end{tabular}
1. Following an impairment review of goodwill in 2023 , Tzs \( 9,000,000 \) of the goodwill relating to Heron was written off.
2. Heron did not pay any dividends during the year to 30 September 2023. Sparrow paid a dividend of Tzs 10,000,000 in 2023 .
3. Eagle includes dividends received in operating profit.
2
4. During the year to 30 September 2023 Sparrow sold goods to Eagle for Tzs \( 40,000,000 \). These goods had cost Sparrow Tzs 33,500,000. At 30 September 2023 Eagle had 25\% of these goods in stock.

Required:
Prepare the Eagle plc's consolidated profit and loss account and consolidated balance sheet for the year ended 30 September 2023

QUESTION ONE
Eagle, Heron & Sparrow
On 1 October 2016 Eagle plc acquired, for Tzs 316,000,000; 80,000 Tzs 1,000 ordinary shares in Heron Ltd. The profit and loss reserves at the date of acquisition totalled Tzs 250,000,000.

On 30 September 2010 Eagle plc acquired, for Tzs 47,000,000; 20,000 Tzs 1000 ordinary shares in Sparrow Ltd. The profit and loss reserves at the date of acquisition totalled Tzs 35,000,000.

Summarised balance sheets at 30 September 2022, and profit and loss accounts for the year ended on that date were as follows:

Eagle plc

Tzs '000'

Heron Ltd

Tzs '000'

Sparrow Ltd

Tzs '000'

4|l| Profit & loss accounts

Operating profit 147,000 54,000 51,000

Interest (20,000) (5,000) (4,000)

Profit before tax 127,000 49,000 47,000

Taxation (42,000) (23,000) (15,000)

Profit for the year 85,000 26,000 32,000

4|l| Balance sheets

Subsidiary 316,000 - -

Associate 47,000 - -

[t]2* Other net assets 308,000 441,000 128,000

671,000 441.000 128,000

Share capital 220,000 100,000 50,000

[t]2* Profit & loss reserves 451,000 341,000 78,000

671.000 441,000 128.000

1. Following an impairment review of goodwill in 2023 , Tzs 9,000,000 of the goodwill relating to Heron was written off.
2. Heron did not pay any dividends during the year to 30 September 2023. Sparrow paid a dividend of Tzs 10,000,000 in 2023 .
3. Eagle includes dividends received in operating profit.
2
4. During the year to 30 September 2023 Sparrow sold goods to Eagle for Tzs 40,000,000. These goods had cost Sparrow Tzs 33,500,000. At 30 September 2023 Eagle had 25% of these goods in stock.

Required:
Prepare the Eagle plc's consolidated profit and loss account and consolidated balance sheet for the year ended 30 September 2023

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