Fish Ltd Acquired an 80 Per Cent Interest in Chips

question 7

Multiple Choice

Fish Ltd acquired an 80 per cent interest in Chips Ltd on 1 July 2003 for a cash consideration of $838,000. At that date the fair value of the net assets of Chips Ltd was represented by:

On 30 June 2005 Fish Ltd sold all its shares in Chips Ltd for $950,000. At this date the fair value of the net assets of Chips Ltd was represented by:

The retained earnings of $490,000 includes operating profit after tax of $90,000 from the current period. Impairment of goodwill was assessed at $6,000. The investment has not been marked to market during the period that the shares were held. What is the amount of profit or loss on the sale of the shares recognised in the books of Fish Ltd during the period ended 30 June 2005?

• A) $14,000
• B) $112,000
• C) $20,000
• D) $118,000
• E) None of the given answers.

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Definitions:

Fate Maps

Diagrams or maps that predict or trace the developmental fate of cells in embryos to show where they will end up and what they will become in the mature organism.

Morphogen Genes

Specific sequences of DNA that determine the relationship of structures during development; often expressed in a gradient across the embryo.

Cytoplasmic Segregation Routes

Cellular mechanisms involved in the distribution of cytoplasmic components between daughter cells during cell division.

Embryonic Signposts

Critical markers or events in the development of an embryo that guide the process of embryogenesis.