Andreas Company purchased 30% of the outstanding shares of Rafif Company for $400.000 on January 2, 2023. Information relatedto Rafif's equity position and performance during 2023 is as follows:02-Jan-2303-Jan-23$2.100.000Retained Earnings$2.900.000 Rafif Company’s Total Equity$5.000.000 20-JulRafif Companyannounced and paid a cash dividend of $80.000 05-Oct-23Rafif Companyannounced and paid a cash dividend of $40.000 31-Dec 2023Rafif Company reported net income of $650.000 for the year 31-Dec 2023Rafif Company shares have a market valueof $180 per share Required: Prepare journal entry(ies) needed by Andreas Company to record the investment in Rafif Company from the acquisition date until December 31, 2023, if:The investment has significant influenceThe investment has insignificant influence and classified as OCI

The investment on which has a significant influence by the company is the required to be journalized…

Answered: Prepare journal entry(ies) needed by…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Related questions

Question

Andreas Company purchased 30% of the outstanding shares of Rafif Company for $400.000 on January 2, 2023. Information relatedto Rafif's equity position and performance during 2023 is as follows:

02-Jan-23	03-Jan-23	$2.100.000
Retained Earnings	$2.900.000
Rafif Company’s Total Equity	$5.000.000
20-Jul	Rafif Companyannounced and paid a cash dividend of $80.000
05-Oct-23	Rafif Companyannounced and paid a cash dividend of $40.000
31-Dec 2023	Rafif Company reported net income of $650.000 for the year
31-Dec 2023	Rafif Company shares have a market valueof $180 per share

Required: Prepare journal entry(ies) needed by Andreas Company to record the investment in Rafif Company from the acquisition date until December 31, 2023, if:

The investment has significant influence
The investment has insignificant influence and classified as OCI

Expert Solution

Step by step

Solved in 3 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

First time adoption of international financial reporting standards

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.

Similar questions