Refer to the financial statements of Campbell Soup Company in Appendix A at the end of the book.
a. As of July 28, Year 11, Campbell owned 33% of Arnotts Limited. Explain where Campbell reports the amounts representing this investment.
b. Note 18 contains disclosures regarding the market value of the company's investment in Arnotts Limited. Explain whether this market value is reflected in Campbell's financial statements beyond the disclosures referred to.
c. In July of Year 11, Campbell acquired the remaining shares of Campbell Canada. This is in addition to one other acquisition during Year 11. Describe what the difference between the purchase price paid for these acquisitions and the fair market value of the acquired net assets implies for analysis purposes.
d. Prepare a composite journal entry recording the total Year 11 acquisitions.
e. Explain the likely causes of changes in the cumulative translation adjustment accounts for (1) Europe and (2) Australia.