Create an Account

Already have account?

Forgot Your Password ?

Home / Questions / Winnipeg Exchanges Ltd. completed the following long-term investment transactions during 2...

Winnipeg Exchanges Ltd. completed the following long-term investment transactions during 2017 2017 May 12 Purchased 20000 shares which make

Winnipeg Exchanges Ltd. completed the following long-term investment transactions during 2017: 2017 May 12 Purchased 20,000 shares, which make up 35% of the common shares of Fellingham Corporation at a total cost of $370,000 July 9 Received annual cash dividend of $1.26 per share on the Fellingham investment Sept. 16 Purchased 800 common shares of Tomassini Inc. as a non-strategic investment, paying $41.50 per share Oct. 30 Received cash dividend of $0.30 per share on the Tomassini investment Dec. 31 Received annual report from Fellingham Corporation. Net income for the year was $510,000. At year-end the current fair value of the Tomassini shares is $30,600. The fair value of the Fellingham shares is $652,000. The company reports changes in fair value through other comprehensive income. Requirements 1. For which investment is current fair value used in the accounting? Why is fair value used for one investment and not the other? 2. Show what Winnipeg Exchanges Ltd. would report on its year-end balance sheet and income statement for these investment transactions. It is helpful to use a T-account for the Long-Term Investment in Fellingham Shares account. Ignore income tax.

Apr 06 2020 View more View Less

Answer (Solved)

question Subscribe To Get Solution

Related Questions