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  • (Transaction Price + Transaction Cost) (Transaction Price + Transaction Cost) (Transaction Price Only)

    Transféré par

    Shang Bugayong
    9 vues1 page
    The document compares three models for accounting for jointly controlled entities: the cost model, equity model, and fair value model. Under the cost model, investments are recorded at cost and only adjusted for impairments. The equity model records the initial investment at cost and adjusts it for the entity's share of post-acquisition profits or losses. The fair value model adjusts the investments to fair value each period, recognizing gains or losses in net income.

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    Titre original

    Jointly Controlled Entites

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    The document compares three models for accounting for jointly controlled entities: the cost model, equity model, and fair value model. Under the cost model, investments are recorded at cost and only adjusted for impairments. The equity model records the initial investment at cost and adjusts it for the entity's share of post-acquisition profits or losses. The fair value model adjusts the investments to fair value each period, recognizing gains or losses in net income.

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    © All Rights Reserved
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    Signaler comme contenu inapproprié
    9 vues1 page

    (Transaction Price + Transaction Cost) (Transaction Price + Transaction Cost) (Transaction Price Only)

    Transféré par

    Shang Bugayong
    The document compares three models for accounting for jointly controlled entities: the cost model, equity model, and fair value model. Under the cost model, investments are recorded at cost and only adjusted for impairments. The equity model records the initial investment at cost and adjusts it for the entity's share of post-acquisition profits or losses. The fair value model adjusts the investments to fair value each period, recognizing gains or losses in net income.

    Droits d'auteur :

    © All Rights Reserved
    Téléchargez comme DOCX, PDF, TXT ou lisez en ligne sur Scribd
    Signaler comme contenu inapproprié
    sur 1

    JOINTLY CONTROLLED ENTITES

    COST MODEL EQUITY MODEL FAIR VALUE MODEL


    To record Investment in Jointly Controlled Entities (X) 10,000 Investment in Jointly Controlled Entities (X) 10,000 Investment in Jointly Controlled Entities (X) 10,000
    acquisitio Investment in Jointly Controlled Entities (Y) 15,000 Investment in Jointly Controlled Entities (Y) 15,000 Investment in Jointly Controlled Entities (Y) 15,000
    n of 25% Investment in Jointly Controlled Entities (Z) 28,000 Investment in Jointly Controlled Entities (Z) 28,000 Investment in Jointly Controlled Entities (Z) 28,000
    equity of Cash 53,000 Cash 53,000 Cash 53,000
    X, Y, Z. (transaction price + transaction cost) (transaction price + transaction cost) (transaction price only)
    Investment in Jointly Controlled Entities (X) 100 Investment in Jointly Controlled Entities (X) 100
    To record Profit / loss 530
    Investment in Jointly Controlled Entities (Y) 150 Investment in Jointly Controlled Entities (Y) 150
    transactio Cash 530
    Investment in Jointly Controlled Entities (Z) 280 Investment in Jointly Controlled Entities (Z) 280
    n cost.
    Cash 530 Cash 530
    To record
    Cash 250 Cash 250 Cash 250
    dividends
    Profit / loss (dividend received) 250 Investment in Jointly Controlled Entities (X) 250 Profit / loss (dividend from JCE) 250
    declared
    and paid.
    To record
    dividends Receivable 2,000 Receivable 2,000 Receivable 2,000
    declared Profit / loss (dividend received) 2,000 Investment in Jointly Controlled Entities (X) 2,000 Profit / loss (dividend from JCE) 2,000
    and not
    yet paid.
    Investment in Jointly Controlled Entities (X) 1,250
    Profit / Loss (Share in JCEs earnings) 1,250

    To record Investment in Jointly Controlled Entities (Y) 4,500


    share in Profit / Loss (Share in JCEs earnings) 4,500
    profit.
    Profit / Loss (Share in JCEs earnings) 5,000
    Investment in Jointly Controlled Entities (Z) 5,000

    To record
    Profit / Loss (Impairment loss) 14,030 Profit / Loss (Impairment loss) 9,030
    impairmen
    Investment in Jointly Controlled Entities (Z) 14,030 Investment in Jointly Controlled Entities (Z) 9,030 NO ENTRY.
    t loss of
    entity Z.
    Investment in Jointly Controlled Entities (X) 3,000
    Investment in Jointly Controlled Entities (Y) 14,000
    To record
    Profit / loss (Change in Fair Value) 17,000
    decrease
    in Fair
    Profit / Loss (Change in Fair Value) 13,000
    Value.
    Investment in Jointly Controlled Entities (Z) 13,000

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