Analysis and Calculations Should Be Based on the Requirements of Current

question 2

Essay

Analysis and calculations should be based on the requirements of current Canadian GAAP.
The following balance sheets have been prepared on December 31,2010 for Clarke Corp.and Jensen Inc. Additional Information:
Clarke uses the cost method to account for its 50% interest in Jensen,which it acquired on January 1,2007.On that date,Jensen's retained earnings were $20,000.The acquisition differential was fully amortized by the end of 2010.
Clarke sold Land to Jensen during 1999 and recorded a $15,000 gain on the sale.Clarke is still using this Land.Clarke's December 31,2010 inventory contained a profit of $10,000 recorded by Jensen.
Jensen borrowed $20,000 from Clarke during 2010 interest-free.Jensen has not yet repaid any of its debt to Clarke.
Both companies are subject to a tax rate of 20%.
-Prepare a Balance Sheet for Clarke on December 31,2010 in accordance with current Canadian GAAP,assuming that Clarke's Investment in Jensen is a joint venture investment.

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Definitions:

Manic State

A period of abnormally elevated or irritable mood, arousal, and energy levels, often seen in bipolar disorder.

Psychosis

A significant psychological disorder characterized by such a profound disruption in thinking and emotional regulation that the individual loses touch with the outside world.

High Energy Level

A state of having abundant physical or mental strength, allowing for sustained activity or productivity.

Positive Self-Image

An individual's subjective perception of themselves, characterized by confidence, respect, and a positive outlook on one's abilities and attributes.