Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Bridgeport Inc. received dividends from its common share investments during the year ended December 31, 2020, as follows: A cash dividend of $10,800 is received

Bridgeport Inc. received dividends from its common share investments during the year ended December 31, 2020, as follows:

A cash dividend of $10,800 is received from Peel Corporation. Bridgeport owns a 10% interest in Peel.
A cash dividend of $55,200 is received from Vonna Corporation. Bridgeport owns a 26% interest in Vonna and a majority of Bridgeports directors are also directors of Vonna Corporation.
A cash dividend of $65,600 is received from Express Inc., a subsidiary of Bridgeport.

Determine how much dividend income Bridgeport should report on its 2020 consolidated statement of comprehensive income.

Dividend income to be reported by Bridgeport Inc. $_________

On April 11, 2020, Sarasota Corp. purchased as a long-term investment (accounted for using FV-OCI without recycling) 6,900 common shares of Roddy Ltd. for $81 per share, which represents a 4% interest. On December 31, 2020, the shares market price was $87 per share. On March 3, 2021, Sarasota sold all 6,900 shares of Roddy for $106 per share. Assume that all companies follow IFRS. Determine the amount of the gain or loss on disposal that should be included in Sarasotas net income in 2021 and in its other comprehensive income. The investment in Roddy Ltd. was Sarasota Corp.s only investment.

_______ on disposal of Investment $______________

Other Comprehensive___________ $_______________

Prepare the journal entries for situation 2 for 2021. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.)

Account Titles and Explanation

Debit

Credit

(To adjust to fair value at date of disposal)

(To record disposal)

(To reclassify holding gain)

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Principles Of Auditing

Authors: A. Pandu

1st Edition

8189630822, 978-8189630829

More Books

Students also viewed these Accounting questions

Question

What do you mean by dual mode operation?

Answered: 1 week ago

Question

Explain the difference between `==` and `===` in JavaScript.

Answered: 1 week ago