On January Year Anderson Corporation paid $ for of the outstanding shares of Carter Inc. The investment was considered to be one of significant influence. In Year Carter reported profit of $; in Year its profit was $ Dividends paid were $ in each of the two years.
Required
Calculate the balance in Andersons investment account as at December Year
Part B
Now assume that on December Year Anderson lost its ability to significantly influence the operating, investing, and financing decisions for Carter when another party obtained sufficient shares in the open market to obtain control over Carter. Accordingly, the investment in Carter was reclassified as a FVTPL investment. The fair value of the Carter shares was $ per share on this date.
In Year Carter reported profit of $ and paid dividends of $ On December Year Anderson sold its investment in Carter for $ per share.
Required
Prepare the journal entry at December Year to reclassify the investment from significant influence to FVTPL
Prepare all journal entries for Year related to Andersons investment in Carter.
