Chapter 9
Investments
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c) Calculate the balance of each investment of George Company at the end of 2016 and
2017.
Analysis
Assume in 2018, George Company purchased an additional 100,000 shares from a total of
1,000,0000 outstanding common shares of Siya company. Would this transaction have any
impacts on this investment? Explain.
AP-13B
(
1
3
)
The following are investment activities for Quentin Company. Assume the company follows
IFRS and has a year-end of December 31.
1) On January 1, 2016, Quentin Company spent $19,750 to purchase a $20,000, 90-day T-bill
at 5% interest. Quentin Company is planning to hold the investment until maturity.
2) On March 1, 2016, Quentin Company made a strategic business investment of $90,000 in
Hallow Company, by acquiring 25% of its 100,000 outstanding shares.
3) On July 30, 2016, Quentin Company received a cash dividend from Hallow Company
of $0.18 per share. A total profit of $65,000 was reported on Hallow Company’s Income
Statement published on July 1, 2016.
