Prepare consolidated statement of comprehensive income for the year ended 31 December 2013 from the above question

Accounting

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Answer

GH¢702m\textbf{GH¢702m}

Step-by-step solution

4 steps

Here is the consolidated statement of comprehensive income for the year ended 31 December 2013. All figures are in GH¢'m.

  1. Consolidate Revenue, Cost of Sales, and Admin & Distribution Costs

    • Consolidated Revenue = Africa (GH¢400m) + Ghana (GH¢340m) + Togo (GH¢320m) = GH¢1,060m
    • Consolidated Cost of Sales = Africa (GH¢88m) + Ghana (GH¢60m) + Togo (GH¢64m) = GH¢212m
    • Consolidated Admin and Distribution Costs = Africa (GH¢20m) + Ghana (GH¢14m) + Togo (GH¢14m) = GH¢48m

  2. Consolidate Investment Income and Taxation

    • Investment income from Ghana in Africa's books (GH¢24m) and from Togo in Ghana's books (GH¢6m) are inter-company dividends and must be eliminated.
    • Consolidated Investment Income = Africa (GH¢24m) + Ghana (GH¢6m) - Inter-company dividends (GH¢24m + GH¢6m) = GH¢0m
    • Consolidated Taxation = Africa (GH¢48m) + Ghana (GH¢30m) + Togo (GH¢20m) = GH¢98m

  3. Calculate Profit Attributable to Non-Controlling Interest (NCI)

    • NCI in Togo's profit: 40%×GH¢222m=GH¢88.8m40\% \times \text{GH¢}222\text{m} = \text{GH¢}88.8\text{m}
    • Ghana's own profit for the year (excluding its share of Togo's profit):
      • Ghana's reported profit: GH¢242m
      • Ghana's share of Togo's profit: 60%×GH¢222m=GH¢133.2m60\% \times \text{GH¢}222\text{m} = \text{GH¢}133.2\text{m}
      • Ghana's own profit = GH¢242m - GH¢133.2m = GH¢108.8m
    • NCI in Ghana's own profit: 20%×GH¢108.8m=GH¢21.76m20\% \times \text{GH¢}108.8\text{m} = \text{GH¢}21.76\text{m}
    • Total Profit attributable to NCI = GH¢88.8m + GH¢21.76m = GH¢110.56m

  4. Prepare the Consolidated Statement of Comprehensive Income

    Africa Ltd GroupConsolidated Statement of Comprehensive IncomeFor the year ended 31 December 2013\textbf{Africa Ltd Group} \\ \textbf{Consolidated Statement of Comprehensive Income} \\ \textbf{For the year ended 31 December 2013} RevenueGH¢1,060mCost of Sales(GH¢212m)Gross ProfitGH¢848mAdmin and Distribution Costs(GH¢48m)Investment IncomeGH¢0mProfit before taxGH¢800mTaxation(GH¢98m)Profit for the yearGH¢702mOther comprehensive incomeGH¢0mTotal comprehensive incomeGH¢702mProfit attributable to:Owners of the parentGH¢591.44mNon-controlling interestGH¢110.56mTotalGH¢702mTotal comprehensive income attributable to:Owners of the parentGH¢591.44mNon-controlling interestGH¢110.56mTotalGH¢702m\begin{array}{lrr} \text{Revenue} & & \text{GH¢}1,060\text{m} \\ \text{Cost of Sales} & & (\text{GH¢}212\text{m}) \\ \text{Gross Profit} & & \text{GH¢}848\text{m} \\ \text{Admin and Distribution Costs} & & (\text{GH¢}48\text{m}) \\ \text{Investment Income} & & \text{GH¢}0\text{m} \\ \text{Profit before tax} & & \text{GH¢}800\text{m} \\ \text{Taxation} & & (\text{GH¢}98\text{m}) \\ \textbf{Profit for the year} & & \boxed{\textbf{GH¢702m}} \\ \text{Other comprehensive income} & & \text{GH¢}0\text{m} \\ \textbf{Total comprehensive income} & & \boxed{\textbf{GH¢702m}} \\ & & \\ \text{Profit attributable to:} & & \\ \quad \text{Owners of the parent} & & \text{GH¢}591.44\text{m} \\ \quad \text{Non-controlling interest} & & \text{GH¢}110.56\text{m} \\ \textbf{Total} & & \textbf{GH¢}702\text{m} \\ & & \\ \text{Total comprehensive income attributable to:} & & \\ \quad \text{Owners of the parent} & & \text{GH¢}591.44\text{m} \\ \quad \text{Non-controlling interest} & & \text{GH¢}110.56\text{m} \\ \textbf{Total} & & \textbf{GH¢}702\text{m} \\ \end{array}
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