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Chipper Co reports in British pounds. On 1 April 20X7, it acquired an 80% interest in Cricket Inc. Net assets of Cricket Inc as at 1 April 20X7 were $391,680 and $489,600 as at 31 December 20X7, the reporting date. Profit for the period 1 April to 31 December 20X7 is $97,920 and is to be translated at the average rate. Assume that no goodwill arose on the acquisition. Exchange rates are as follows (USD/GBP):
What is the total effect of this acquisition on group reserves at 31 December 20X7? A. £88,400. B. £46,080. C. £70,720. D. £57,600. |