Entity A holds a small number of shares in entity B. The shares are classified as available-for-sale.
Question:
Entity A holds a small number of shares in entity B. The shares are classified as available-for-sale. On 31 March 2010, the shares’ fair value is EUR 2,400 and the cumulative gain recognised in OCI is EUR 400. On the same day, entity B is acquired by entity C, a large listed company. As a result, entity A receives shares in entity C at a fair value of EUR 2,600.
What should entity A do in connection with the transactions described above?
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Step by Step Answer:
Entity A should recognize the transaction and adjust the values of the shares in its accounts and fi...View the full answer
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Related Book For 
Advanced Financial Accounting An International Approach
ISBN: 9780273712749
1st Edition
Authors: Jagdish Kothari, Elisabetta Barone
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