Blue Spruce Corp. is deciding whether to purchase 40% of Kyla Corp.'s shares for $1.60 million cash, giving Blue Spruce significant influence over the investee company, or 60% of Kyla's shares for $2.40 million cash, making Kyla a subsidiary company. The book value of Kyla's net assets is $4.00 million (assets are $16 million and liabilities are $12.00 million). (a) How will this investment affect Blue Spruce's statement of financial position if Blue Spruce acquires a 40% interest, assuming Blue Spruce applies IFRS? Indicate the immediate effect on Blue Spruce's total assets, total liabilities, and shareholders' equity. (Enter answers in millions to 2 decimal places, e.g. 1.25. Do not leave any answer field blank. Enter O for amounts and no effect for effects. If an amount reduces the account balance then enter with negative sign.)

Blue Spruce Corp. is deciding whether to purchase 40% of Kyla Corp.'s shares for $1.60 million cash, giving Blue Spruce significant influence over the investee company, or 60% of Kyla's shares for $2.40 million cash, making Kyla a subsidiary company. The book value of Kyla's net assets is $4.00 million (assets are $16 million and liabilities are $12.00 million). (a) How will this investment affect Blue Spruce's statement of financial position if Blue Spruce acquires a 40% interest, assuming Blue Spruce applies IFRS? Indicate the immediate effect on Blue Spruce's total assets, total liabilities, and shareholders' equity. (Enter answers in millions to 2 decimal places, e.g. 1.25. Do not leave any answer field blank. Enter O for amounts and no effect for effects. If an amount reduces the account balance then enter with negative sign.)

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Zina Manufacturing Company started and completed Job 501 in December with the following Job Cost Sheet and transferred it to the warehouse. Direct Materials Date Dec 17 Dec 30 Total Direct Labor Amount Date Amount $2,000 Dec 20 $4,000 8,000 Dec 30 3,800 Total Job Cost Sheet - Job No. 501 Total Cost The journal entry to record the transaction is A) WIP Inventory FG Inventory B) Cost of Goods Sold WIP Inventory C) FG Inventory WIP Inventory D) FG Inventory WIP Inventory Debit Credit 35,800 17,800 17,800 Manufacturing Overhead Date Amount Dec 24 $10,000 Dec 30 8,000 Total 35,800 35,800 17,800 17,800 35,800