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Ayton Ltd acquired 10387 shares of Bridges Co. (out of 80,000 outstanding shares) on 1/1/2020 for $11.49 per share. In 2020 Bridges reported $69620 in
Ayton Ltd acquired 10387 shares of Bridges Co. (out of 80,000 outstanding shares) on 1/1/2020 for $11.49 per share. In 2020 Bridges reported $69620 in net earnings, $12499 in OCI, and paid $20562 in dividends. Ayton estimates that at 1/1/2020, Bridges had an unrecorded intangible asset worth $150834 with a useful life of 15 years and unrecorded goodwill for the remainder of the fair value differences. At 12/31/2020, Bridges' market price was $14.2 per share. Assume that the equity method is appropriate (regardless of whether it is). Determine the following for 2020 for Ayton's investment in Bridges: Earnings reported as part of net income Value of the investment reported on the balance sheet at year end. Now assume the same information as above, except that the fair value method should be applied. Under the fair value method, determine how much Ayton should include for its Bridges investment in net income for 2020. What is the value of the Bridges investment on the balance sheet at year end? For this question, assume that IFRS applies and Ayton accounts for its investment in Bridges as FVOCI. How much income should Ayton record in 2020 in net income for its investment in Bridges
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