Reference no: EM132811785
On January 1, 2016, CAPTIVES Corporation acquired as a long-term investment for 8,100,000 a 45% interest in an investee when the fair value of the net assets was 18,000,000. The investee reported the following net profit/losses during the following years:
|
Year
|
Net profit (loss)
|
|
2016
|
4,800,000
|
|
2017
|
1,000,000
|
|
2018
|
8,000,000
|
|
2019
|
8,000,000
|
|
2020
|
4,000,000
|
On January 1, 2019, CAPTIVES made cash advances of 800,000 to the investee. On December 31, 2020, it is not expected that the CAPTIVES will provide further financial support for the investee.
Problem 1: During 2018, Investment in associate account should credited at what amount?
Problem 2: During 2019 when recording the loss on investment, Investment in associate account should credited at what amount?
Problem 3: During 2019 when recording the loss on investment, Advances to associate account should credited at what amount?
Problem 4: During 2020 when recording the loss on investment, loss on investment should debited at what amount?
Problem 5: During 2020 after recording the loss on investment, the cumulative loss on investment that is not recognized is?