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Question: gtgton 1 july 2019 quick buck ltd took control of...

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>>On 1 July 2019, Quick Buck Ltd took control of the assets and liabilities of Eldorado Ltd. Quick Buck Ltd issued 80,000 shares having a fair value of $2.40 per share in exchange for the net assets of Eldorado Ltd. The costs of issuing the shares by Quick Buck Ltd cost $1,600.

 

At this date the statement of financial position of Eldorado Ltd was as follows:

 

Carrying amount

Fair value

Machinery  

$40,000

$67,000

Fixtures & fittings

60,000

60,000

Vehicles

35,000

35,000

Current assets

10,000

12,000

Current liabilities (

(16,000)

 

(18,000)

Total net assets

$129,000

 

Share capital (80,000 shares at $1.00 per share)

$80,000

 

General reserve

20,000

 

Retained earnings

29,000

 

 

Total equity

$129,000

 

 

Required:

Prepare the journal entries in the records of Quick Buck Ltd on 1 July 2019 for the acquisition.

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