Findit Gold Inc. (FGI) was created in 2012 and is 25% owned by Findit Mining Corporation (FMC).

Question:

Findit Gold Inc. (FGI) was created in 2012 and is 25% owned by Findit Mining Corporation (FMC). FGI’s shares trade on the local exchange and its objective is to become a substantial low-cost mineral producer in developing countries. FMC provided substantial financial support to FGI when FGI was in the exploration stage.

Over the most recent five-year period, FGI carried its gold bullion inventory at net realizable value and recognized revenues on the gold produced (net of refining and selling costs) at net realizable value, when the minerals were produced. Gold is a commodity that trades actively and whose price fluctuates according to supply and demand.

Instructions

Assume the role of the controller of FMC and assess the financial reporting policies relating to inventory valuation and revenue recognition.

Corporation
A Corporation is a legal form of business that is separate from its owner. In other words, a corporation is a business or organization formed by a group of people, and its right and liabilities separate from those of the individuals involved. It may...

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Overview Findit Gold Inc FGI is a public company and therefore there is a GAAP constraint IFRS FMC owns 25 and will be interested in the profitability of FGI since it has been financially supporting t...View the full answer

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Intermediate Accounting Volume 1

ISBN: 978-1119496496

12th Canadian edition

Authors: Donald E. Kieso, Jerry J. Weygandt, Terry D. Warfield, Irene M. Wiecek, Bruce J. McConomy

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Question Posted: Nov 28, 2019 09:07 AM

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Findit Gold Inc. (FGI) was created in 2012 and is 25% owned by Findit Mining Corporation (FMC).

Question:

Step by Step Answer:

Overview Findit Gold Inc FGI is a public company and therefore there is a GAAP constraint IFRS FMC owns 25 and will be interested in the profitability of FGI since it has been financially supporting t...View the full answer

Intermediate Accounting Volume 1

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