Advanced Accounting in Canada, 1Ce (Johnstone) Chapter 2 Accounting for Non-Controlled Investments 2.1 Account for passive (non-strategic) investments in equity, including journal entries. 1) Non-strategic investments may be classified as a fair value through other comprehensive income (FVOCI), fair value through profit or loss (FVTPL), or as a cost investment. Which of the following statements is true? A) Dividend revenue is reported in the income section of the statement of income for each of the three classifications. B) For a non-strategic investment classified as a FVOCI, dividend revenue is reported in the other comprehensive income section of the statement of income. C) Dividend revenue is only reported as income when the investment is classified as a cost investment. D) Dividend revenue is only reported in the income section the statement of income when the investment is classified as FVTPL or FVOCI. Answer: A Diff: 1 Type: MC Taxonomy Category: Understanding Learning Outcome: 2.1 Account for passive (non-strategic) investments in equity, including journal entries.
2) Ecole Inc., a private company reporting under ASPE, owns 9% of the voting common shares of Plato Corp. Ecole Inc. has classified its investment as a passive investment. On November 15, 2022, Plato Corp. declared a dividend $100,000. The dividend will be paid on January 15, 2023. What journal entry or entries should Ecole Inc. make related to the dividends declared by Plato Corp.? A) November 15, 2022 Dr. Dividend receivable 9,000 Cr. Dividend revenue 9,000 January 15, 2023
B) January 15, 2023
C) January 15, 2023
D) November 15, 2022
January 15, 2023 Answer: A Diff: 2
Type: MC
Dr. Cash Cr. Dividend receivable
9,000
Dr. Cash Cr. Dividend revenue
9,000
Dr. Cash Cr. Investment in Plato Corp.
9,000
Dr. Dividend receivable Cr. Investment in Plato Corp.
9,000
Dr. Cash Cr. Dividend receivable
9,000
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9,000
9,000
9,000
9,000
9,000
