Pina Colada Corporation purchased a 25% interest in Krov Corporation on January 2, 2020, for $1,000. At that time, the carrying amount of Krov’s net assets was $3,500. Any excess of the cost of the investment over Pina Colada’s share of Krov’s carrying amount can be attributed to unrecorded intangibles with a useful life of 20 years. Krov declared and paid a dividend of $16 and reported a net income of $80 for its year ended December 31, 2020. 

Required: Prepare Pina Colada’s 2020 entries to record all transactions and events related to the investment in its associate.  Assume that Pina Colada is a publicly accountable enterprise that applies IFRS.

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Pina Coladas 2020 entries to record the investment in its associate January 2 Pina Colada Corporatio... View the full answer