Significant influence
Julep Corporation purchases a 25% interest in Orange Corporation on January 2, 2020, for $ 800. At that time, the carrying amount of Orange's net assets was $ 2,952. Any excess of the cost of the investment over Julep's share of Orange's carrying amount can be attributed to unrecorded intangibles with a useful life of 20 years. Orange declared and paid a dividend of $ 16 and reported net income of $ 52 for its year ended December 31, 2020.
Instructions
Prepare Julep's 2020 entries to record all transactions and events related to the investment in its associate. Assume Julep is a publicly accountable enterprise that applies IFRS.

Question

Quizplus · Accepted Answer

The Answer of Significant influence
Julep Corporation purchases a 25% interest in Orange Corporation on January 2, 2020, for $ 800. At that time, the carrying amount of Orange's net assets was $ 2,952. Any excess of the cost of the investment over Julep's share of Orange's carrying amount can be attributed to unrecorded intangibles with a useful life of 20 years. Orange declared and paid a dividend of $ 16 and reported net income of $ 52 for its year ended December 31, 2020.
Instructions
Prepare Julep's 2020 entries to record all transactions and events related to the investment in its associate. Assume Julep is a publicly accountable enterprise that applies IFRS.

Significant Influence Julep Corporation Purchases a 25% Interest in Orange Corporation on Corporation