Exercise 178-22 (Part Level Submission) Indigo Company has the following investm

Question

Exercise 178-22 (Part Level Submission) Indigo Company has the following investments as of December 31, 2017 Investment in debt secunities of FourSquare Company $1,580,000 $3,220,000 ents, the carrying value and the fair value of influence on the operations of Laser Company. Indigo's debt investment is considered held-to-maturity. At December 31, 2018, the debt investment securities of FourSquare are valued at $2,400,000. Assume that these investments are considered these two investments are the same at December 31, 2017. Indigo's stock investments does not resuilt in significant the same at (a) the shares in Laser impaired er Company are valued at $1,140,000

Explanation / Answer

CALCULATION OF LOSS ON IMPAIRNMENT ON INVESTMENT IN LASER AND FOUR SQUARE COMPANY Investment in laser Company = $              15,80,000 Less: Market Value as on Dec, 31 2018 $              11,40,000 Loss on impairnment $                 4,40,000 Investment in Foursquare Company $              32,20,000 Less: Market Value as on Dec, 31 2018 $              24,00,000 Loss on impairnment $                 8,20,000 Journal Entries Date ACCT Title and explanation Debit Credit Dec - 31, 2018 Impairnment Losses Account $4,40,000.00        To Investment in Laser Co. $4,40,000.00 (investment in laser company is impaired) Dec - 31, 2018 Impairnment Losses Account $8,20,000.00        To Investment in Laser Co. $8,20,000.00 (investment in FourSquare Copmay is impaired)

Related Questions

Navigate

• Browse (All)
• Browse E
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.