Chur Company acquired a 40% interest in Flip company for 1,700,000 on January 1, 2020. The shareholders equity of FLip company on Janaury 1 and December 31, 2020 us presented below: January 1 December 31 Share capital 3,000,000 3,000,000 Revaluation surplus - 1,300,000 Retained earnings 1,000,000 1,500,000 On January 1, 2020 all the identifiable assets and liabilities of Flip company were recorded at fair value. Flip company reported profit before income tax of 1,000,000 and paid dividends of 150,000 to shareholders during the current year. The revaluation surplus is the result of the revaluation of land recognized by Flip company on December 31, 2020. Flip presents OCI net of applicable income tax. Additionally, depreciation is provided by Flip Company on the diminishing balance method whereas Chur company uses straight line. Had Flip company used the straight line, the accumulated depreciation would be increased by 200,000. The tax rate is 35%. Chur Company report its investment in associate on Dec. 31, 2020 at?
Chur Company acquired a 40% interest in Flip company for 1,700,000 on January 1, 2020. The shareholders equity of FLip company on Janaury 1 and December 31, 2020 us presented below:
January 1 December 31
Share capital 3,000,000 3,000,000
Revaluation surplus - 1,300,000
On January 1, 2020 all the identifiable assets and liabilities of Flip company were recorded at fair value. Flip company reported profit before income tax of 1,000,000 and paid dividends of 150,000 to shareholders during the current year.
The revaluation surplus is the result of the revaluation of land recognized by Flip company on December 31, 2020. Flip presents OCI net of applicable income tax. Additionally,
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