Mr. Thompson is a businessman. He started a business five years ago and it has increased in size gradually for its continuous success. Thompson Inc. is a private company and it uses ASPE for preparing its financial statements. It has completed accounting year on December 31, 2017. At the end of 2017, the financial position statement shows that there is huge amount of surplus cash and Thompson has shown interest in investing a part of the surplus amount to the equity securities of Panna Corporation. It is also a growing company in the same industry. The balance sheets of Thompson Inc. and Panna Corporation as on December 31, 2017 with fair values of assets and liabilities of Panna Corporation are presented below:

Thompson Inc. Panna Corporation Assets: Carrying Amount Carrying Amount Fair value Cash $400,000 $10,000 $10,000 Accounts receivable 80,000 25,000 22,000 Inventory 100,000 70,000 75,000 Plant 500,000 165,000 175,000 Patents 100,000 25,000 25,000 Trade marks 20,000 Goodwill 120,000 10,000 10,000 Total Assets 1,300,000 305,000 Liabilities and Equity: Current liabilities $160,000 55,000 60,000 Long-term liabilities 100,000 65,000 60,000 Common shares (At $10 per share) 1,000,000 100,000 Retained earnings 40,000 85,000 Total liabilities and equity 1,300,000 305,000