Pigeau Ltd. purchased 42,000 common shares of Lindsay Corporation for $ 1,000,000. During the year, Lindsay Corporation reported profit of $ 500,000 and paid dividends of $ 125,000. On December 31, Pigeau's year end; Lindsay Corporation's common shares had a market value of $ 25 per share.
Instructions
a) Assuming that the 42,000 shares represent a 15% interest in Lindsay Corporation and are classified by management as FVTPL investments:
1. Prepare the journal entry to record the investment in Lindsay shares.
2. Prepare any entries that Pigeau should make in accounting for its investment in Lindsay shares during the year.
3. At what amount is this investment reported on Pigeau's December 31 balance sheet?
a) above except assume that the 42,000 common shares represent a 25% interest in Lindsay Corporation but Pigeau does not have significant influence over Lindsay, and Pigeau elects to account for the investment as fair value through other comprehensive income.
a) above except assume that the 42,000 shares represent a 25% interest in Lindsay Corporation which provides Pigeau with significant influence over Lindsay and are accounted for as a long-term equity investment.
b) Repeat requirement
c) Repeat requirement in
a) Assuming that the 42,000 shares represent a 15% interest in Lindsay Corporation and are classified by management as FVTPL investments:

Question

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The Answer of Pigeau Ltd. purchased 42,000 common shares of Lindsay Corporation for $ 1,000,000. During the year, Lindsay Corporation reported profit of $ 500,000 and paid dividends of $ 125,000. On December 31, Pigeau's year end; Lindsay Corporation's common shares had a market value of $ 25 per share.
Instructions
a) Assuming that the 42,000 shares represent a 15% interest in Lindsay Corporation and are classified by management as FVTPL investments:
1. Prepare the journal entry to record the investment in Lindsay shares.
2. Prepare any entries that Pigeau should make in accounting for its investment in Lindsay shares during the year.
3. At what amount is this investment reported on Pigeau's December 31 balance sheet?
a) above except assume that the 42,000 common shares represent a 25% interest in Lindsay Corporation but Pigeau does not have significant influence over Lindsay, and Pigeau elects to account for the investment as fair value through other comprehensive income.
a) above except assume that the 42,000 shares represent a 25% interest in Lindsay Corporation which provides Pigeau with significant influence over Lindsay and are accounted for as a long-term equity investment.
b) Repeat requirement
c) Repeat requirement in
a) Assuming that the 42,000 shares represent a 15% interest in Lindsay Corporation and are classified by management as FVTPL investments: