Reference no: EM133031209

Question - On January 1, 2020, Ayayai Corporation, a public company following IFRS, acquired 15,300 of the 51,000 outstanding common shares of Noah Corp. for $25 per share. Noah's statement of financial position reported the following information at the date of the acquisition:

Assets not subject to depreciation $285,000

Assets subject to depreciation 868,500

Liabilities 146,500

Additional information:

1. On the acquisition date, the fair value is the same as the carrying amount for the assets that are not subject to depreciation and for the liabilities.

2. On the acquisition date, the fair value of the assets that are subject to depreciation is $948,500. These assets had a remaining useful life of eight years at that time.

3. Noah reported 2020 net income of $80,000 and paid dividends of $3,800 in December 2020.

4. Noah's shares are not actively traded on the stock exchange, but Ayayai has determined that they have a fair value of $24 per share on December 31, 2020.

Required -

1- Prepare the journal entries for Ayayai Corporation for 2020, assuming that Ayayai cannot exercise significant influence over Noah and accounts for the investment at FV-OCI.

2- Prepare the journal entries for Ayayai Corporation for 2020, assuming that Ayayai can exercise significant influence over Noah's operations.

3- Prepare the 2020 journal entries if Ayayai Corporation were a private company applying ASPE.