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There will be no Non-controlling Interest as 100% shares of Sub Ltd. are held by Hold Ltd.
3. Post-acquisition profits of Sub Ltd. Rs
Profit for 6 months from 1.10.2017 to 31.3.2018 (14,40,000 x 7,20,000
6/12)

Less: Additional depreciation on account of revaluation of Plant (50,000)
and Machinery for 6 months [(40,00,000 x 10% x 6/12) –
(30,00,000 x 10% x 6/12)]
Adjusted post-acquisition profit attributable to Hold Ltd. 6,70,000
4. Consolidated profit or loss for the year Rs
Hold Ltd.
Retained earnings on 31.3.2018 11,44,000
Less: Retained earnings as on 1.4.2017 (0)
Profits for the year 2017-2018 11,44,000
Less: Elimination of intra-group dividend (4,00,000)
Adjusted profit for the year 7,44,000
Sub Ltd.
Adjusted profit attributable to Hold Ltd. (W.N.3) 6,70,000
Consolidated profit or loss for the year 14,14,000
5. Goodwill/Gain on bargain purchase Rs
Amount paid for 40,000 shares of Sub Ltd. 68,00,000
Less: Share of Hold Ltd. in pre-acquisition equity
of Sub Ltd. 40,00,000
Share capital 33,20,000
Pre-acquisition reserves of Sub Ltd. (W.N.2)
Fair value adjustments (W.N.1) 32,50,000 (1,05,70,000)
Gain on Bargain Purchase 37,70,000
6. Value of Plant & Machinery Rs
Hold Ltd. 48,00,000

Sub Ltd. Book value as on 31.3.2018 27,00,000
Book value as on 1.4.2017 (27,00,000/90%) 30,00,000
Less: Depreciation @ 10% for 6 months (1,50,000)
28,50,000
Add: Appreciation on 1.10.2017 11,50,000
(Balancing fig. i.e., 40,00,000 – 28,50,000)
Revalued amount (given) 40,00,000
Less: Depreciation on Rs 40,00,000 @ 10% for 6 months (2,00,000) 38,00,000
86,00,000

7. Consolidated retained earnings
Hold Ltd. Sub Ltd. Total
As given 11,44,000 16,40,000 27,84,000
Consolidation Adjustments:
(i) Elimination of pre-acquisition element [6,00,000 + 0 (13,20,000) (13,20,000)
7,20,000]
(ii) Elimination of intra-group dividend (4,00,000) 4,00,000 0
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