On January 1, 2019, X Inc. purchased 25% of the voting shares of Y Inc. for $100,000. The investment is reported using the equity method, as X has significant influence over Y. Y's net income and declared dividends for the following three years are as follows:

	Net Income	Dividends
2019	$50,000	$20,000
2020	$70,000	$80,000
2021	$30,000	$60,000

What would be the carrying value of X's Investment in Y at the end of 2021?

Multiple Choice

• $100,000

• $91,200

• $97,500

• $98,800

The IASB standard (IFRS 3 Business Combinations) issued with respect to the treatment of negative goodwill requires that:

Multiple Choice

• it must be recognized in income immediately as an extraordinary item.

• it must be recognized in income immediately.

• it must be reflected as an increase in Liabilities and a Reduction in Capital for the Parent Company.

• it can be deferred and amortized over a maximum of 40 years.

IOU Inc. purchased all of the outstanding common shares of UNI Inc. for cash of $800,000. On the date of acquisition, UNI's assets included $2,000,000 of Inventory, and Land with a Book value of $120,000. UNI also had $1,400,000 in Liabilities on that date. UNI's book values were equal to their fair market values, with the exception of the company's Land, which was estimated to have a fair market value which was $50,000 higher than its book value. UNI also had patent rights with a fair market value on acquisition date of $20,000 that were not shown on its balance sheet because the rights had been developed internally. How much goodwill would be created by IOU's acquisition of UNI?

Multiple Choice

• $30,000

• $10,000

• $70,000

• $80,000