Lovell Corporation purchased 200,000 of the 1 million common shares of Abacus Ltd. on October 1, 2012, at $2.50 per share. Near the end of the fourth quarter, Abacus declared and paid dividends on its common shares of $80,000. Lovell received its share of the dividends on December 29. Abacus also announced that it had profit for the quarter ending December 31, 2012, of $200,000. At the end of the year, the Abacus common share price had risen to $3 per share.

Instructions

Record the journal entries that Lovell would make during the last quarter ending December 31, 2012, under the following assumptions:

(a) Lowell reports under IFRS and has significant influence over Abacus.

(b) Lowell reports under IFRS but does not have significant influence over Abacus.

(c) Lowell reports under ASPE and has significant influence over Abacus but has chosen to use the cost model for this investment under the assumption that the fair value of Abacus shares cannot be obtained.