On 1 July 2012,Felix Ltd acquires all shares in Oscar Ltd for $800 000.The fair value of net assets acquired is $620 000 comprising $400 000 in share capital and $220 000 in retained earnings.What is the appropriate elimination entry for this investment that is in accordance with AASB 3 Business Combinations and AASB 10 Consolidated Financial Statements?
A)

\begin{array} { | l | l | r | r | } \hline & & ( \$ 000 ) & ( \$ 000 ) \\\hline \mathrm { Dr } & \text { Investment in subsidiary } & 800 & \\\hline \mathrm { Cr } & \text { Goodwill } & & 180 \\\hline \mathrm { Cr } & \text { Share capital } & & 400 \\\hline \mathrm { Cr } & \text { Retained earnings } & & 220 \\\hline\end{array}

\begin{array} { | l | l | r | r | } \hline & & ( \$ 000 ) & ( \$ 000 ) \\\hline \mathrm { Dr } & \text { Investment in subsidiary } & 800 & \\\hline \mathrm { Cr } & \text { Gain on bargain purchase } & & 180 \\\hline \mathrm { Cr } & \text { Share capital } & & 400 \\\hline \mathrm { Cr } & \text { Retained earnings } & & 220 \\\hline\end{array}

\begin{array} { | l | l | r | r | } \hline & & ( \$ 000 ) & ( \$ 000 ) \\\hline \mathrm { Dr } & \text { Share capital } & 400 & \\\hline \mathrm { Dr } & \text { Retained earnings } & 220 & \\\hline \mathrm { Dr } & \text { Goodwill } & 180 & \\\hline \mathrm { Cr } & \text { Investment in subsidiary } & & 800 \\\hline\end{array}

\begin{array} { | l | l | r | r | } \hline & & ( \$ 000 ) & ( \$ 000 ) \\\hline \mathrm { Dr } & \text { Share capital } & 400 & \\\hline \mathrm { Dr } & \text { Retained earnings } & 220 & \\\hline \mathrm { Dr } & \text { Gain on bargain purchase } & 180 & \\\hline \mathrm { Cr } & \text { Investment in subsidiary } & & 800 \\\hline\end{array}

A Subsidiary

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