X Ltd . ( X ) purchased 4 0 % of Y Ltd . (
Question:
X LtdX purchased of Y LtdY on January for $ Y paid dividends of
$ in each year. Ys income statements for and showed the following.
Income loss before income taxes
$
$
Income taxes expense recovery
Net income loss
$
$
Other comprehensive income next of tax
Comprehensive income loss
$
$
At December the fair value of the investment was $ and at December the fair value of the investment was $
Required marks:
a Prepare Xs journal entries for and assuming that this is a nonstrategic investment and is accounted for at fair value through profit and loss FVTPL
b Prepare Xs journal entries for and assuming that this is a significant influence investment and will be reported using the equity method.
Income Tax Fundamentals 2013
ISBN: 9781285586618
31st Edition
Authors: Gerald E. Whittenburg, Martha Altus Buller, Steven L Gill