SMU Co. follows IFRS and has a December 31 year end. SMU has the following information...
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SMU Co. follows IFRS and has a December 31 year end. SMU has the following information concerning its investments held at December 31, 2020: 1) Purchased shares of ABC Co. for $10,000 on July 1, 2019 plus $200 of transaction costs. The investment is accounted for using the fair value through net income (FV-NI) method. 2) Purchased shares of XYZ Co. for $4,000 on January 1, 2019. The investment is accounted for using the fair value through other comprehensive income (FV-OCI) method. Details of the investments in 2019 & 2020 follows: АВС Со. XYZ Co. 2019 2020 2019 2020 Dividends declared & paid $350 $100 $120 $135 Fair Value at Dec 31 $9,850 $10,300 $4,240 $3,700 None of the investments were considered impaired. On February 1, 2021, SMU sells all of its investments: 1) ABC Co. is sold for $10,250. 2) XYZ Co. is sold for $3,470 Required: a) Prepare all journal entries for SMU relating to the ABC Co. investment for 2019 & 2020 & 2021. b) Prepare all journal entries for SMU relating to the XYZ Co. investment for 2019 & 2020 & 2021. c) Ignoring tax impacts: i) Show the effect of the investments (accounts and amounts) on SMU's Statement of Comprehensive income for the years ended December 31, 2019, 2020, & 2021. (ie. Accounts and amounts per year.) i) Show SMU's Classified Statement of Financial Position at December 31, 2020 for: All investment assets- accounts and amounts All equity accounts - accounts and amounts (Equity accounts will show the cumulative impact on the accounts for both years) SMU Co. follows IFRS and has a December 31 year end. SMU has the following information concerning its investments held at December 31, 2020: 1) Purchased shares of ABC Co. for $10,000 on July 1, 2019 plus $200 of transaction costs. The investment is accounted for using the fair value through net income (FV-NI) method. 2) Purchased shares of XYZ Co. for $4,000 on January 1, 2019. The investment is accounted for using the fair value through other comprehensive income (FV-OCI) method. Details of the investments in 2019 & 2020 follows: АВС Со. XYZ Co. 2019 2020 2019 2020 Dividends declared & paid $350 $100 $120 $135 Fair Value at Dec 31 $9,850 $10,300 $4,240 $3,700 None of the investments were considered impaired. On February 1, 2021, SMU sells all of its investments: 1) ABC Co. is sold for $10,250. 2) XYZ Co. is sold for $3,470 Required: a) Prepare all journal entries for SMU relating to the ABC Co. investment for 2019 & 2020 & 2021. b) Prepare all journal entries for SMU relating to the XYZ Co. investment for 2019 & 2020 & 2021. c) Ignoring tax impacts: i) Show the effect of the investments (accounts and amounts) on SMU's Statement of Comprehensive income for the years ended December 31, 2019, 2020, & 2021. (ie. Accounts and amounts per year.) i) Show SMU's Classified Statement of Financial Position at December 31, 2020 for: All investment assets- accounts and amounts All equity accounts - accounts and amounts (Equity accounts will show the cumulative impact on the accounts for both years)
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Answer rating: 100% (QA)
Solution a Journal Entries Date Particular Amount Dr Amount Cr 01072019 Equity shares of ABC ltd Ac Dr 10000 Transactions Charges Ac 200 To Bank aC 12... View the full answer
Related Book For
Accounting Principles
ISBN: 978-1119048503
7th Canadian Edition Volume 1
Authors: Jerry J. Weygandt, Donald E. Kieso, Paul D. Kimmel, Barbara Trenholm, Valerie Warren, Lori Novak
Posted Date:
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