Please provide high quality answers for the 4 questions in the pdf file. Everything should be based on IFRS in Canada. Please read the journal entry and F/S format file before you start wokring on the

ACCT 4201: Advanced Financial Accounting 1 TRU Open Learning Assignment 1 (50 marks ; 10% ) Instructions Before you complete this assignment, make sure you have completed all module activities and read the Assignment instructions . Save your file as a Word document. Question 1 ( 6 marks ) Com plete the following . Marks are allocated for before tax unrealized profit and after tax unrealized profit. Show calculations for possible part marks. a) P Company sold merchandise to a subsidiary for $ 64,000. Gross pr ofit rate is 40%. At year end , 20% of this re mains unsold. The tax rate is 3 0%. W hat is the before tax and after -tax unrealized profit in ending inventory? Please highlight the after -tax unrealized profit in yellow. (2 marks ) Clearly indicate your answers as shown below: Calculations: Before tax unrealized profit: After tax unrealized profit: b) P Company sold merchandise to a subsidiary for $ 63 ,000. The mark -up on cost is 50%. At year end , 20% of this re mains unsold. The tax rate is 3 0%. What is the before tax and after tax unrealized profit in ending inventory? Ple ase highlight the after -tax unrealized profit in yellow. (2 marks ) Clearly indicate your answers as indicated below: Calculations: Before tax unrealized profit: After tax unrealized profit: c) AB Company issued a 10 year, 5 %, $2,000,000 bond paying interes t tw ice a year at a market rate of 4 .2%. What was the issue price? Please highlight the issue price in yellow. (2 marks ) Question 2 ( 17 marks ) On January 1, Year 1, Head Ltd. purchased 50,000 common shares , representing 40% of the outstanding shares , of Toe Ltd. for $8 00,000 . The assets of Toe included a building with a market value $300,000 greater than book value. The building had a remaining useful life of 10 years. 2 Assignment 1 TRU Open Learning During Year 1, Toe had a net income of $ 20 0,000 and paid dividends of $ 80,000. Du ring Year 1, Head sold Toe merchandise for $24 0,000 at a gross profit rate of 40%. At year end, 50% of this merchandise remained in Toe’s inventory. Head’s tax rate is 30%. During Year 2, Toe had a net income of $240,000 and paid dividends of $140,000. A t year end, the market price of the shares was $18. Required: a) Provide all the necessary Year 1 journal entries for Head Ltd. from purchase to all year -end adjustments , assuming they have significant influence. Your journal entries must be in standard form. b) Show all calculations necessary to determine the end of Year 2 balance in Head’s “Investment in Toe” account. Use a table format with one line per item and label each item. Provide th e ending balance. Pleas e highlight your final figure in yellow. Question 3 ( 12 marks ) On December 31, 201 7, PCP Ltd. purchased bonds of ACP Ltd. The bonds mature on December 31, 20 22 , and have a maturity value of $1,000,000. The stated interest rate on the bonds is 4% (yearly ra te). Interest is paid each June 30 and December 31. The bonds were purchased to yield 3.4% (yearly rate). The bonds will be accounted for as FVTPL . a) What was the purchase price of the bonds (to the nearest dollar) ? Please highlight your final figure in y ellow. b) i) How much bond interest income (round to the nearest dollar) should PCP report on June 30, 2018 ? (Please highlight your final figure in yellow.) ii) How much bond interest income (round to the nearest dollar) should PCP report on December 31, 201 8? (Please highlight your final figure in yellow.) c) On December 31, 201 8, the bonds were available in the secondary market at a yield rate of 3.6%. i) Should PCP report an unrealized gain or loss , a realized gain or loss, or no gain or loss ? Explain why. ii) Regard less of your answer to i) , assume they should report some kind of gain or loss. What would be the amount of the gain or loss? Show calculations for possible part marks. Please highlight your final figure in yellow , and clearly indicate if it is a gain or a loss. ACCT 4201: Advanced Financial Accounting 3 TRU Open Learning Question 4 (15 marks ) On January 1, 201 7, Happy Inc. purchased 80% of the outstanding common shares of Sad Co. for $ 40 0,000. Happy will account for Sad using the Fair Value Enterprise method. The balance sheets for both companies immediately after t he transaction appear below. Happy Inc. Sad Co. Book value Fair value Cash $ 115,000 $ 30,000 $ 30,000 Accounts receivable 205,000 90,000 90,000 Inventory 160,000 130,000 140,000 Plant and Equipment 700,000 560,000 540,000 Land 80,000 90,000 150,000 Investment in Sad Co. 400,000 — — Goodwill — 25,000 — $ 1,660,000 $ 925,000 Accounts payable $ 250,000 $ 170,000 $ 170,000 Bonds payable 640,000 450,000 460,000 Common shares 350,000 240,000 Retained earnings 420,000 65,000 $ 1,660,000 $ 925,000 4 Assignment 1 TRU Open Learning Required: a) Calculate goodwill using fair values . Please highlight the goodwill amount in yellow. (2 marks ) b) Calculate goodwill using net book value s, including allocation of the acquisition differential. You must also calculate the value of non -controlling interest in this calculation. Please highlight the NCI amount in yellow. (2 marks ) c) Prepare a consolidated balance s heet . Your statement must be in good form. Marks will be deducted for poor presentation. Please note that the above balance sheets are for your information and are not considered to be “good form.” (11 marks )