On January 1, Poitras Ltée, a public company, purchases 20% of Riverbed Corporation's common shares for $250,000 for strategic purposes. For the year ended December 31, Riverbed reports profit of $228,000 and pays a $15,000 cash dividend. The fair value of Poitras's investment in Riverbed at December 31 is $279,000. Prepare journal entries required assuming Poitras has significant influence over Riverbed. (Record entries in the order displayed in the problem statement. Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts. List all debit entries before credit entries.)
On January 1, Poitras Ltée, a public company, purchases 20% of Riverbed Corporation's common shares for $250,000 for strategic purposes. For the year ended December 31, Riverbed reports profit of $228,000 and pays a $15,000 cash dividend. The fair value of Poitras's investment in Riverbed at December 31 is $279,000. Prepare journal entries required assuming Poitras has significant influence over Riverbed. (Record entries in the order displayed in the problem statement. Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts. List all debit entries before credit entries.)
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Please Correct answer and Full details and Do not Give solution in image format
Transcribed Image Text:On January 1, Poitras Ltée, a public company, purchases 20% of Riverbed Corporation's common shares for $250,000 for strategic
purposes. For the year ended December 31, Riverbed reports profit of $228,000 and pays a $15,000 cash dividend. The fair value of
Poitras's investment in Riverbed at December 31 is $279,000.
Prepare journal entries required assuming Poitras has significant influence over Riverbed. (Record entries in the order displayed in the
problem statement. Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required,
select "No Entry" for the account titles and enter O for the amounts. List all debit entries before credit entries.)
Date
I
Account Titles and Explanation
✓
Cash
Dividend Revenue
Income from Investment in Associate
Investment in Associate
Investments at FVTPL
No Entry
Other Comprehensive Income-Gain on Fair Value Adjustment
(To record investment income.)
Debit
Credit
Transcribed Image Text:On January 1, Poitras Ltée, a public company, purchases 20% of Riverbed Corporation's common shares for $250,000 for strategic
purposes. For the year ended December 31, Riverbed reports profit of $228,000 and pays a $15,000 cash dividend. The fair value of
Poitras's investment in Riverbed at December 31 is $279,000.
Prepare journal entries required assuming Poitras has significant influence over Riverbed. (Record entries in the order displayed in the
problem statement. Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required,
select "No Entry" for the account titles and enter O for the amounts. List all debit entries before credit entries.)
Date
1
Account Titles and Explanation
(To record investment income.)
Debit
11
Credit
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