There are 260,000 common shares issued and outstanding in PC Inc. Champion Incorporated bought 91,000 common shares of PC Inc. on December 31, 2020 for $957,000. This acquisition provided Champion Incorporated with significant influence over PC Inc. On December 31, 2020, PC Inc. reported assets of $4,600,000 and liabilities of $1,932,000 on its balance sheet. The book values of PC Inc.'s assets and liabilities are equal to their fair values, except for depreciable assets. PC Inc's depreciable assets have a fair value of $610,000 and a net book value of $558,000. These depreciable assets have a remaining useful life of 8 years. On September 10, 2021, PC Inc. paid a total of $95,000 in dividends to its common shareholders. For the year ended December 31, 2021, PC Inc. generated net income of $326,000. Champion Incorporated follows IFRS.

There are 260,000 common shares issued and outstanding in PC Inc. Champion Incorporated bought 91,000 common shares of PC Inc. on December 31, 2020 for $957,000. This acquisition provided Champion Incorporated with significant influence over PC Inc. On December 31, 2020, PC Inc. reported assets of $4,600,000 and liabilities of $1,932,000 on its balance sheet. The book values of PC Inc.'s assets and liabilities are equal to their fair values, except for depreciable assets. PC Inc's depreciable assets have a fair value of $610,000 and a net book value of $558,000. These depreciable assets have a remaining useful life of 8 years. On September 10, 2021, PC Inc. paid a total of $95,000 in dividends to its common shareholders. For the year ended December 31, 2021, PC Inc. generated net income of $326,000. Champion Incorporated follows IFRS.

Cornerstones of Financial Accounting

4th Edition

ISBN:9781337690881

Author:Jay Rich, Jeff Jones

Publisher:Jay Rich, Jeff Jones

ChapterA2: Investments

Section: Chapter Questions

Problem 25E

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