It is now time for Question Period, the leader of Her Majesty's Law Opposition. Mr. Speaker, my question is for the Premier. But first I want to thank the over 150,000 nurses in Ontario as they celebrate Nursing Week 2016. And I believe that all registered nurses, nurse practitioners, registered practical nurses and nursing students deserve our praise each and every day. And I will stand with the nursing profession as they have faced unprecedented cuts by this government. Everywhere I travel, Mr. Speaker, in the corner, I hear about nursing cuts. In Timmins, dozens of jobs cut. At Trillium Health Partners in Mississauga, 15 RNs just cut. At Runnymaid Health Centre in Toronto, half the RNs have been cut. This is just a small fraction of the 1,400 nurses fired in the last year. And Mr. Speaker, I'm not interested in a history lesson of what the government did 15 years ago or 50 years ago. My question is, why have you fired 1,400 nurses in the last year? Do you see the face? There's an indication that things are going to ramp up and I will bring it down. Premier? Very much, Mr. Speaker. Well, I certainly understand why the leader of the opposition wouldn't want to talk about the past. He wouldn't want to talk about the record of that party when they were in office. Nor would he want to talk about the nine years that he spent in the Stephen Harper government when the Health Accord was cut, Mr. Speaker. So I understand why he doesn't want to talk about that. So let's talk about the facts, Mr. Speaker. Let's talk about the facts that, since 2003, more than 26,000 nurses, including 11,000... Let's talk about the fact, Mr. Speaker, that year over year we have increased healthcare funding, including this year, Mr. Speaker, a billion dollars of which is for hospitals. There is a consistent trend line, Mr. Speaker. In 2015, the number of nurses employed in nursing in Ontario increased for the 11th consecutive year. Those are the facts, Mr. Speaker. Thank you. Supplementary? Mr. Speaker, back to the Premier. Last week at a town hall meeting in Sault Ste. Marie, residents and frontline workers shared with the Sault Starr the horror stories of the liberal cuts. Glenda Hubley, President of the Ontario Nurses Association, Local 46, apologized on behalf of all frontline employees. Despite the fact that they do their best to emit extreme pressures under their work, sometimes they can't do it alone. But this government is forcing them to do it alone. Our frontline workers deserve better. Our patients deserve better. Mr. Speaker, again to the... Deputy House Leader...  Well, Mr. Speaker, I know that the people of Sault Ste. Marie are very happy with their new hospital and all the services that it's providing. And I know they're happy with their nurse practitioner-led clinic and the family health teams as well that are providing excellent care due to the excellent work of those frontline healthcare workers. But, Mr. Speaker, it is simply not true that we're cutting the number of nurses in any sector because when you look at just the hospital sector alone between 2011 and 2015, the net increase because I know the both opposition parties like to talk about the gross, just the layoffs and not the new hires. But when you look at the net change between 2011 to 2015, just nurses in our hospital sector have increased by 7,625 positions. Mr. Speaker, again to the Premier. Sometimes I wonder what fantasy world this government lives in. You've got the Minister of Finance saying hydro rates are going down. health saying he isn't cutting nurses, despite the fact 1400 were fired last year, 1400 that we desperately needed. So let me point out another example, Mr. Speaker, in Simcoe County. As soldiers memorial, 16 beds just cut, 35 people fired. The numbers don't lie. The hospital cuts we're seeing in every hospital in Ontario do not lie. Mr. Speaker, the people of Simcoe County deserve better. The residents of Rama First Nation served by Surgill's Soldiers Memorial deserve better. Will the Liberals reverse the cuts at Surgill's Memorial? Will they do the right thing and support our nurses? Question, thank you. Minister? Well, Mr. Speaker, in fact the changes that have been made at North Simcoe, rather at Aurelia Soldiers Hospital, were the result of a recommendation coming from the LIN, but also from a provincial rehabilitation association that looks at complex continuing care. And it looks at how they can actually bring those services and those supports closer to people in their communities. And the decision, this one aspect of the decision at Soldiers Hospital in fact was a result of the provincial rehabilitative care alliance and the LIN and the hospital itself realizing that they could actually shift support closer to the communities where that complex continuing care is made. That's what's happening. It's actually an improvement in the services that Ontarians can expect. It's unfortunate that, unlike almost all of his colleagues in the PC party, I wish the leader of the official opposition would actually come to me if he's got concerns about hospitals across the problem. Thank you. New question from the Leader of the Opposition. Mr. Speaker, my question is for the Premier. Since I can't get an answer on the 1,400 nursing cuts, I'll try something else. I want to read to you a sub-headline from an editorial... Stop the plug. Come to order, please. Mr. Speaker, I want to read you a sub-headline from an editorial in the Toronto Star this past weekend. It read, the government wants to reduce waitlist times for intensive treatment for autism. Unfortunately, it is doing this by simply cutting kids on the waitlist tour over five. That's not fair. This government's idea of helping children with autism is taking them from one waitlist and just putting them on another. Mr. Speaker, it's not too late for this government to reverse course and do the right thing. Mr. Speaker, will the Premier listen to the fine folks of the Toronto Star on their recommendation and fund autism for families? Fund IVR. Well, thank you very much, Mr. Speaker. And they are fine folks at the Toronto Star as all our media gallery. But Mr. Speaker, I will say that on this, it's very important that we understand exactly what is happening. And that is that there are children who have been sitting on a waiting list not getting service, Mr. Speaker. And the status quo is unacceptable. It is unacceptable to us on this side of the house that children who need therapy in a window of time, Mr. Speaker, as they develop, that they not get that therapy. So, Mr. Speaker, we are investing in the system so that those children will get the service that they need. We are working with the families. The service providers are working with the families. The education system is working with the Ministry of Children Youth Services because we know, Mr. Speaker, that helping those children through the transition, making sure they get the intensive service when they need it and then that they are able to be socialized in school, that is what children need, Mr. Speaker. And it's up to us to make sure we get them off a waiting list and into that transition, Mr. Speaker. Mr. Speaker, back to the Premier. And the Premier is not going to listen to that editorial, the Toronto Star. Maybe the Premier will listen to Michael Barrett, President of the Ontario Public School Board Association. And he said, I quote, it's never too late to correct a mistake. And cutting IBI treatment for children over five is a mistake. It is a mistake to take the chance for IBI treatment away from a five-year-old like Keith in Toronto. His mum called these changes devastating to her child's future. And she said these devastating cuts to Keith's treatments are heartbreaking. Mr. Speaker, why is this Premier, why is this government taking away IBI from children that desperately need it? Well, Mr. Speaker, as I just said, what we are doing is we are working to ensure that 16,000 more children get service, Mr. Speaker, that the service that the children get is tailored to their needs, Mr. Speaker, that they move off the waiting list, that they have the opportunity to immediately start to buy services, Mr. Speaker, and that they make a transition into new service that is tailored to their needs based on a clinical assessment, Mr. Speaker. That is of much more benefit, of much more benefit to a child than sitting on a waiting list. And quite frankly, I don't understand why either of the opposition parties would want to see children languish on a waiting list, getting no service when they know perfectly well that kids need service early and they need it continuously, Mr. Speaker. Thank you. Order. Later the third party come to order, please. Final supplementary. Mr. Speaker, back to the Premier. I'll go back to this Toronto Star editorial that I mentioned earlier to quote the Toronto Star, to suddenly strip children and families of the hope to which they have clung. Sometimes for years is too cruel a way to save money or find efficiencies, too cruel. Mr. Speaker, that is exactly what this move by the government is. The Toronto Star is right when they say it is cruel. Thousands of families waited for years. Then with the stroke of a pen, this government ripped any ounce of hope that these families had away. Mr. Speaker, will the Premier put herself in the shoes of these families that you have kicked off the list? Will you give them the hope they need, the hope they deserve? Mr. Speaker, will the Premier do the right thing? It's not too late. Will you fund IBI for kids over five? That doesn't end at five. Thank you. Premier. Minister of Children Youth Services. Thank you, Speaker. So one thing we can agree on, I think, here is we do want to give hope to those children. We want to give hope to families. And it's important to note that we are not taking kids away from service who are on that wait list. We're putting them into service, Speaker. And our service providers will work very closely with those families. In terms of education, the Minister of Education and our staffs are working together. And I read the Michael Barrer article. I know him personally. I know the Minister of Education does. We're reaching out to him to make sure he has all the facts and the information about how we're going to continue to give hope to these kids. How we're going to not accept that they're on wait list for potentially up to five years by 2018. I think nobody wants to see that. So it's very important we work with our education partners because many of our children's speakers are school age or will be coming school age very shortly. And we want to support them. Thank you. Thank you very much, Mr. Speaker. My question is for the Premier. When families are at their most vulnerable, they count on a nurse to be there. But for the last 16 months, nurses have been fired at a rate of 90 a month. That's three per day, Speaker. That is unacceptable. Will this Premier make a clear commitment? No more registered nurses will get a pink slip. No more registered practical nurses will get a pink slip. And no more nurse practitioners in this province will get a pink slip. Thank you. Well, Mr. Speaker, and I refer to the answer that I have already given and repeat that, Mr. Speaker. We have year over year increased numbers. Member from Prince Edward Hastings, come to order. Increase the amount of money that goes into healthcare, Mr. Speaker. And the Minister of Health and Long-Term Care has made it clear that between 2011 and 2015, over 7,000 nurses, Mr. Speaker, have been hired and placed in this province. The fact is, Mr. Speaker, that if you look at the changes that are being made in the system, it's true. There are services that are moving out of hospitals into the community, Mr. Speaker, or in some cases moving closer to communities, Mr. Speaker. And that means changes. That means changes in personnel. It means changes in location. But it doesn't mean fewer healthcare providers, Mr. Speaker. And in fact, it means more healthcare providers as we increase service across the province. Thank you. The supplementary? On Friday, the Premier was touring an Ottawa hospital. But on the other side of the city, in another Ottawa hospital, nurses were given notice of more layoffs. Queensway Carlton Hospital told staff that five full-time and one part-time nurses from the childbirth program would be laid off. And a full-time team leader in surgery would also be eliminated. Fewer nurses means less care and longer wait times for the people of Ottawa, Speaker. And make no mistake, this Premier is directly responsible. Cutting nurses is the wrong thing to do. Patients know it, families know it, new Democrats know it, nurses know it. On Nursing Week, how can this Premier defend another round of liberal cuts to frontline nurses in Ottawa? Thank you. Mr. Speaker of Health and Long-Term Care. Mr. Speaker, I wish we could at least agree on one thing. That we choose an independent source for the statistics that we provide in this legislation. That we don't talk about gross numbers or layoffs without talking about the new positions added. And I would hope that we could agree and it's transparent for all Ontarians to see the College of Nurses of Ontario. That they publish on an annual basis the statistics for nurses in this province. And well, if you don't want to believe the College of Nurses of Ontario, that's your choice. But they've indicated that in the last year alone, almost 3,000 new nursing positions in this province, not new. But they've said years, almost 8,000 new nurses in our hospitals, the majority of them are in. I would choose to believe the College on these. I would implore the opposition parties to do this. Thank you. Final supplementary. Speaker, since 2012 the Liberals have taken $100 million out of the Ottawa hospital's budget. That's a fact. Forcing that hospital to cut frontline healthcare workers year after year. That too is a fact, Speaker. Over at CHEO, another 27 full-time physicians had to be cut last year. Another fact, Speaker. And now on Friday, the Health Minister admitted that this year's funding for Ottawa's hospitals, like Opeta Montfort, will not keep up with inflation and population growth. Another fact, Speaker. It will not repair the damage. It will not stop the cuts to nursing. In fact, it means another year of cuts to healthcare in Ottawa. Why won't this Premier do the right thing, Speaker, and put a stop to any more nursing cuts in Ontario's hospitals? Thank you. Minister. Well, Mr. Speaker, it is true that on Friday, the Premier and I was honored to be with the RAPML4 hospital, we announced new funding and increase of $19 million for the Ottawa hospitals, Mr. Speaker. And it is also a fact that by any indicator, according to the College of Nurses of Ontario, we have more RNs working in this province than since we came into office. We have more RPNs. We have more nurse practitioners, whether it's per capita or absolute numbers, it's increased, Mr. Speaker. And I can't help, but history is an important lesson. And when you have an opposition, a third party, that 3,000 RNs lost their jobs when they were in power, when they cut funding in the last year of their time in government, cut funding to hospitals, when they closed 24% of the acute hospital beds in this province, I'm not going to take my lessons from a party with that kind of record, Mr. Speaker. You see it, please? You see it, please? Thank you. Start the clock. New question. The leader of the third party. Thank you, Speaker. My next question is also for the Premier. Last Friday, I was in Sarnia. I met an elderly couple who moved to Sarnia because the health care in their hometown of Wallaceburg had faced so many cuts that they wanted to live in a place where they thought they could be sure that they would be able to actually age with dignity, Speaker. Now that they're in Sarnia, the hospital is being forced to cut $5 million from its budget, and the total number of hospital workers cut over the past four years will reach 80. And the hospital will still face a $1.7 million shortfall. This elderly couple thought that they could find security by moving. People can't get away from the cuts, though, Speaker. Will this Premier do the right thing and ensure that hospitals are not being forced to cut? Thank you. Minister of Health and Long-Term Care. Minister of Health and Long-Term Care. Well, again, Mr. Speaker, we're increasing our funding to hospitals across this province by $345 million this year. And that represents a 2.1% increase in the line in the budget for our hospital funding. And it includes Blue Water Health in Sarnia, that, in fact, Blue Water is doing better than the provincial average because they're receiving an additional $3.5 million this year an increase in their operating budget, and that represents a 2.73% increase in their operating budget. So, Mr. Speaker, the facts are we continue to invest in our health care system, an additional $1 billion this year, $345 million of that going into the operating expenses of hospitals, a 2% increase. And that doesn't even begin to talk about the enormous capital investments that we're making across the province. Thank you. Sarnia isn't just cutting another 11 jobs. They're not just facing another $5 million in cuts. The complex continuing care unit is being forced to close eight beds. To the Premier and her Minister and the governing Liberals, this may be all about spin, Speaker, but to the people it's about health and it's about the health care of their families and availability of services in their communities, in their community hospitals. Will this Premier actually face up to the silent crisis that the Liberals are creating in the health care system and put a stop to the hospital cuts right here and right now? Thank you, Minister. Well, Mr. Speaker, we, as I mentioned, we continue to invest. And I want to talk about the capital investments that were outlined in our budget recently passed because over the next decade, we're investing $12 billion in hospitals and renovations and expansions and, in many cases, brand new hospitals right across this province. And then, Mr. Speaker, it's an important investment, but we also recognize that hospitals have ongoing maintenance costs and smaller redevelopment and renovation costs. And so we've increased by $50 million each year in this year's budget the funds that we put towards those renovations. But at the end of the day, Mr. Speaker, we expect our local hospital administrations and their boards, together with our lens, together with the ministry, to make decisions which ensure that the quality of services and care are of the best possible quality. That's our goal, and we work hard to achieve that across this province, Mr. Speaker. Thank you. Well, Mr. Speaker, those hospitals are going to have a hard time serving patients when there aren't any nurses at the bedside. Capital health spending on hospitals in Ontario has fallen. The last time that happened, Mr. Speaker, was in 1997, and Mike Harris was the Premier. And today, just like in 1997, hospitals are being forced to close beds, fire nurses, cancel surgeries, and treat people in conference rooms and in hallways. That's what's happening here in the province of Ontario. Treatment in conference rooms and in hallways because of liberal cuts to our hospital system. When will this Premier stop cutting hospitals, stop firing nurses, and make sure Ontarians can count on our hospitals and our healthcare system? You see it, please? You see it, please? Thank you, Minister. Well, finally, Mr. Speaker, something we can agree on, the fact that the PC Party, when they were in power, there were 6,000 fewer nurses working at the end of their tenure as government. There were 3,000 fewer nurses as well working when the NDP, when they left government compared to the beginning. But, Mr. Speaker, what concerns me is that in their last election platform, they committed to finding $600 million in savings. In fact, the member for Kitchener Waterloo when pressed on the issue by the CBC admitted that those savings were found in healthcare and in education. And when she went on to say, in fact, that she would go first to help to find that $600 million in savings, there's no doubt there would have been dramatic drastic cuts if they had won that election, Mr. Speaker. Thank you. The question, the member from Renfrew, Nipissing Pembroke. Thank you very much. My question is for the Minister of the Environment. Last week, the Minister was forced to backtrack on his negative comments towards the up provinces auto sector. Now, despite his swings at the auto sector, we know that under the government's green investment fund, they're using capital trade money to build charging stations. Now, we're glad that he saw the light on the auto sector after being taken to the woodshed, Speaker. But, why is he giving millions of dollars of contracts to Hydro-Quebec to install electric vehicle charging stations when there are plenty of Ontario companies that can do the job? Why are you doing that, Minister? Thank you. Mr. Speaker, I'm sure my colleagues will also like to make a comment about this, but let's just get the record straight. I, unlike the member opposite, members over here, have voted for the largest investments in our auto sector in the history of Canada. I'm very proud to have worked with the auto sector. And, Mr. Speaker, without the support of the party opposite who doesn't want to see any revenue come out of capital trade for the auto sector, we're about to repeat that and make another massive investment in building the Ontario auto sector and the infrastructure to support it. I need no lessons from the member opposite. I'm being a champion of the auto sector. And when he can pull his voting record to be anywhere near members on this side of the auto sector, because you didn't lose your you didn't learn your lesson and you're opposing the capital trade system that will deliver unprecedented investments in market development, in modernization of plants and in developing new markets for Ontario's automobile Thank you. Let's answer the first question. First we give free hydro to Quebec and now we're going to have them build our charging stations. The minister has had to backtrack on comments made about the nuclear industry, agriculture and the auto sector all in one week. Now the previous office won't even let us speak to the Toronto Board of Trade because there's too much of a liability. It's one thing to say something you'll inform, but it's another to act on it. If the minister thinks it's best to take money raised in the green investment fund money that is raised from the taxpayer of Ontario and invest in contracts to other jurisdictions to build charging stations then answer this, how much money from the green investment fund is going to contracts money from the people of Ontario going to contracts signed with other jurisdictions Minister of transportation Mr. Speaker, thank you. Thanks very much, Speaker. I thank the member of the opposition for this question however misguided it might be. A number of weeks ago I was proud to stand in Mississauga here in Ontario, a wonderful community to announce how we were proceeding with investing the $20 million that we announced back in December to build Speaker by 2017 500 electric vehicle charging stations across the province of Ontario Speaker, this will no doubt lead to a reduction in what we call range anxiety for those individuals who want to make that choice and their effort collectively to help us fight climate change to purchase a zero emission vehicle and I would have thought that that member and the conservative caucus would have supported an initiative that would build a network of fast and traditional chargers and every corner of the province Speaker I was proud to be in Mississauga with Tim Hortons and McDonald's and Ikea's and so many other places across this province Speaker this member should support it. Thanks very much. Any questions? A number from Mr. Speaker, my question is to the Premier. Today we learned that the Premier during her first two years in office her party held nearly 100 big ticket fundraisers and they promised FaceTime with cabinet ministers raising over $2 billion A fundraiser last year was hosted by the very same Bay Street insiders who will benefit from the sale of Hydra One. Also remarkable were that those donors were promised access to the ministers of both finance and energy ministers who made the Hydra One sell-off possible. Now Ontarian should be able to trust that the government makes decisions with respect to energy based on the best interest of the public and not the best interest of the Liberal Party or its donors Will the government launch a public inquiry into the energy sector contracts of Ontario? Thank you. Thanks very much Mr. Speaker As I have said and as we are acting on we are committed to changing political donations in Ontario the information that the leader or the member is talking about is public information and the reporter counted the events and wrote a story about it and that's fine Mr. Speaker but I hope that the leader of the third party still agrees with the position that we should ban corporate and union donations I don't know if the leader of the third party's position has changed because she won't talk to us about what her perspective is on the draft legislation that would come forward and in fact Mr. Speaker last week the government house leader had an effective meeting with the PC house leader and representative of the green party Mr. Speaker and in that meeting we provided a briefing on the draft legislation asked for their feedback and ideas before the bill is introduced into the legislature the only party that wasn't represented was the NDP Mr. Speaker Mr. Speaker Liberal donors are getting rewarded with massive private energy contracts while the people of Ontario are seeing their electricity bills skyrocket they have five OPP investigations into this government two of them that are under way deal with liberal employees allegedly deleting evidence which might show that the government made decisions with the energy sector that were politically motivated as opposed to the benefit of the public now two liberal employees have already been charged criminally it's time to clear the air much like in Quebec with the Charbonne inquiry Mr. Speaker will the government commit to a public inquiry into the energy sector here in Ontario Mr. Speaker of energy Mr. Speaker with respect to the procurement surrounding the IPO as the members know Mr. Speaker we had the auditor general of Canada Denny Denny Desotel established the process for procurement and procurement as we went through it and from his report Mr. Speaker his final report on the basis of the work just described I have concluded that the process followed for the selection of the members of the IPO syndicate and for determining the structure of the syndicate was a fair process and was carried out in a fair and professional manner Mr. Speaker and the quote says no conflict of interest issues were identified whether in relation to members of the commission committee or members of the syndicate and by the way the member from Timmins Mr. Speaker is having a 600 hour dinner tonight for a small group of people I'm standing please caution members about using props and if I see it again it will be taken Thank you new question Member from Cambridge Sorry We'll try again Member from Cambridge My question is for the Minister of Labor Summer in my community of Cambridge and North Dumfries means the end of the school year and it also means that many young people are being hired to work in summer jobs many working for the first time In fact Speaker my 19 year old son Liam started his summer job yesterday and I spoke to him last evening he said that his first day included training on safety in his workplace and he intends to do more Recently the Minister of Labor posted their internship blitz results on their website and have conducted vulnerable worker blitzes in the past these blitzes show us that our government is taking action but we know that more needs to be done Speaker can the minister please let this house know what he is doing to make sure people who are working this spring and summer know their rights and feel safe when we go to work each day Thank you Speaker I'd like to thank the member for that very important question all members of the House can play a role here we should all be encouraging our young people to ask questions when they get their first job to speak up when something they're asked to do perhaps feels unsafe and we have to remind them Speaker that every Ontarian regardless of their age has a right to refuse unsafe work in this province Speaker it's working between 2000 and 2012 lost time to work injuries for young people in this province decreased by 70% that's the largest decline in this country makes Ontario one of the safest places to work in this entire country we continue to protect our young people through blitzes through other initiative Speaker but we also reach out to people that are new to the province we've got a program specifically designed for people who joined us from Syria Speaker workers old and new know the rights is so important in this province Thank you Thank you Speaker I want to thank the Minister for his work on this important file so one way that I know that spring is here is the increase of construction projects throughout Cambridge and the Waterloo Region new and experienced workers participate in these projects such as the ongoing expansion of the Cambridge Memorial Hospital in the 401 to help our cities grow and improve I know that the Minister takes health and safety very seriously and unfortunately we still see incidences ending in tragedy across the province workers continue to get injured on the job or worse lose their lives in my time as an emergency room nurse I saw too many of these types of injuries I know that almost always these incidences could have been prevented health and safety training is paramount to making sure that all of our workers go home in the end of each day Speaker can the Minister please inform the House how our government is helping those who work on construction projects in the coming months Thank you Speaker and thanks again to the member for that great question she points out Speaker one of the worst parts of the job of being the Minister of Labor and that's when you get that phone call or you get that email that somebody that left for work that morning isn't going to go home to their home at that night Speaker so we need to work really hard at that we've increased the amount of health and safety training that now is mandatory in the province of Ontario every single worker in this province speaker has to take basic health and safety training before entering the workforce we've got mandatory training for those who work at heights as of April of this year Speaker in one year 100,000 people in this province have been trained to make Ontario as I said before one of the safest places in this country to work we've got construction health and safety blitzes that are directly to where they need to go targeted inspection Speaker every incident is preventable Speaker let's keep working towards that zero Thank you Speaker My question is to the Minister of Education as a result of changes made to the child care in early years act children entering the school system in September that are under the age of four will no longer be allowed to attend summer camps this decision has taken Ontario families and summer camp operators by surprise the Ontario camps association wasn't even consulted about this change and I quote the act was revised without the benefit of consultation or input of the OCA its members or the thousands of families affected no child should be left behind simply because of their age children who will turn four by December 31st are allowed to register for school but they're not allowed to attend summer camps Minister will you correct this error and make the entry to summer camps consistent with children entering the school system Thank you Yes thank you and I would like to clarify because I found that there's a lot of confusion this is a change that was made this is a change that was made when the act was passed when the child care early years act was passed so it's been no but a lot of people think it's the regulations that were just published yesterday and in fact it's got nothing to do with the regulations it is in fact something that was passed over a year and a half ago so that in fact there has been quite a long lead time before this took effect because the actual law was passed about a year and a half ago and if we put this in the context of what we were trying to do with the Child Care Early Years Act one of the things that we found was that when we had situations where children were unsafe that it was typically children under single age in unlikely Thank you supplementary Thank you speaker there's not a single example of a child in the OCA camp system that has been impacted under four so please don't use a safety argument for this educational professionals including developmental psychologists have told me there's absolutely no science to support the minister's decision to prevent kids from attending summer camp simply because they have yet to turn four this is yet another example of your government ignoring experts to impact our province's families autism, child care regulations and now summer camps will the minister allow children turning four by December 31st to attend summer camps this year Thank you minister Well as I said this is a matter of law not a matter of regulation but if we could look at the situation the kids are not being prevented from attending camp what the law says is that if you are going to have a group of children the member from Dufferin Callaghan come to order have a child care license because the Ontario Camp Association is not a mandatory association it's a voluntary association many many camps in Ontario are not a member of any association there is no regulatory authority that controls camps we want to ensure our youngest children are safe and in order to ensure our youngest children are safe if you are going to have children It's not helpful when I'm trying to hear an answer when people are engaging across the floor that asks the question the member from Hamilton East Stoney Creek my question is to the premier Tim Orton's field in Hamilton was turned over to the city unfinished and nearly a year late last May the construction of this stadium under the watch of the government's infrastructure in Ontario turned into unfortunately a fiasco completion and handover was rushed in order to ensure the stadium we use for the Pan Am Games now another year has passed speaker is still not complete we're two years past due and the city of Hamilton and the Hamilton Tiger Cats have had enough both have filed notices of action in the superior court claiming tens of millions of dollars in damages speaker enough is enough and who did the premier hold accountable for this two year delay and who will she hold accountable if the cost of this province run into the tens of millions of dollars thank you thank you Mr. Speaker and I appreciate the question the member opposite knows all too well how important it was for us to restructure that stadium a stadium which he was very proudly at at the ribbon cutting ceremonies recognizing the outstanding support that we've done for the city of Hamilton as a result of that stadium a stadium which will house the Hamilton Tiger Cats another great event that's coming forward and I'm sure he'll be there at the end of the ceremony as well we know that infrastructure Ontario has done many projects across the province as a lead up to the Pan and Parapan American Games which is a great success for our province and a great economic development of which this one is as well we know the legal realities that are here we also know that the job is getting done and it will be completed thank you Mr. Speaker wow speaker the city of Hamilton's claim specifies damages over construction delays disputed contract items non-compliance with contracts warranty failings and other deficiencies several hundred seats have obstructed views the Tiger Cats claim that infrastructure Ontario which is tasked by the government to arrange all privatized contracts made negligent misrepresentations in relation to the design construction and completion of this stadium speaker three there's a piece to resist on speaker three Pan M executives placed third fourth and fifth on last year's sunshine list collecting over eight hundred thousand dollars each in salaries and bonuses why did the premier authorize bonuses for three Pan M executives question highest paid on the sunshine list when claims of this magnitude were imminent against the Pan M organizing committee Mr. Speaker I appreciate Mr. Speaker the members inference that the work being done there are some short pause infrastructure Ontario is doing what is necessary in regards to perfecting the security and that's exactly what is happening they are getting resolutions moving forward and we are talking about some minor amendments that are required but more importantly Mr. Speaker he's finished what's important Mr. Speaker the stadium was ready for the games and it's going to be ready for the Hamilton Tiger is a brand new home for the champion tie-cats that's proceeding Mr. Speaker without delay thank you thank you new questions from new market well thank you Mr. Speaker through you my question is for the Minister of Natural Resources and Forestry I know that Act is administered by the Ministry of Natural Resources and Forestry and Governors governs activities on crown land and shorelands. Minister, there may be some confusion for waterside property owners because of an Ontario Superior Court justice decision that has changed the permitting requirements under the Public Lands Act for docks and boat houses in Ontario. As a result, I understand some docks and boat houses construction and rebuilding will require a permit from the Ministry of Natural Resources and Forestry in situations where a permit was not required before. Residents of my riding of New Market Error who own waterside properties want to know about the changes and why they were made before they head to their cottages this May long weekend. Would the Minister please explain how permit requirements have changed and what people interested in replacing, expanding or building a new dock or boat house should know? Thank you very much, and I want to thank the member from New Market Error for the question. I believe that probably there are many members in the legislature that have heard about this issue in their constituency offices. If they haven't heard about it yet, I would expect they will be hearing about it soon. I've had an opportunity to talk to at least three members of the official opposition, the Conservative members. We committed in those discussions to advise them that we were working on this. There would be more information forthcoming in the near term. Yesterday, my office sent out a letter to all MPPs. If you haven't received that already, you should be receiving that soon. As the summer season approaches, Speaker, we believe that this issue is going to receive a higher profile in your constituency offices. This is as a result of an Ontario Superior Court of Justice decision relative to the Public Lands Act. In the supplemental line, we're going to provide a bit more information that may not be contained in the letter that they'll be receiving soon to try and explain a bit more detail about what we can expect. Thank you. Thank you to the Minister for his answer. I understand that historically, Ministry of Natural Resources and Forestry permits were only required for docks and boat houses that rested on or were attached to more than 15 square metres of shorelands, usually lake beds. However, in its decision, the Court held that a dock or boat house floating above shorelands is considered to be occupying the lands beneath the structure, regardless of whether it's resting on or attached to the shorelands. I also understand, Speaker, that because of this change from previous procedures, your Ministry is working to simplify the process for individuals who want to build, replace or expand docks or boat houses that are larger than 15 square metres. Would the Minister explain how the Ministry is working to address the issue and what individuals thinking of building, replacing or expanding a dock or boat house should know? Thank you, Minister. Thank you. Again, I want to thank the member from New Market Aurora. Again, to restate this action is the result of a ruling from the Ontario Superior Court of Justice. Some docks and boat houses will now require permits in situations where authorization was not required before. Going forward, new docks or boat houses, seasonal docks or boat houses and expansions to existing docks or boat houses will require a permit if they're larger than 15 square metres. Smaller docks or boat houses that occupy 15 square metres or less of shorelands do not require Public Lands Act authorizations at this time. The Speaker will continue to communicate this information as best we're able. I want to state very clearly, Speaker, that there will be no fees associated with obtaining these dock and boat house permits. It's important that people are aware of that. Speaker, I've also directed officials to explore options and to address this situation. So hopefully, by the fall, we will be in a position to make announcements to all of the members affected by this so that in the years going forward, we won't have to. Thank you. New question to the members from Lanark Island, Athletics, and Addington. Thank you, Speaker. My question is to the Minister of Education. Last week, during Children's Mental Health Week, the Upper Kenna District School Board Director of Education, Stephen Sliwa, announced his arbitrary decision to terminate the Board's long-term partnership with the Court of Treatment Program. For 20 years, this program successfully treated and provided therapy to hundreds of children with behavioral problems graduate back into their schools. Speaker, is the Minister aware that the Upper Kenna District School Board is placing children with behavioral and mental issues, health issues, at a significant disadvantage and making it impossible to deliver quality services obligated under the Education Act? Thank you, Minister of Education. Yes, thank you. And my understanding is that the facility in question is a privately operated group home. There is something, as you would know, Speaker, under the Education Act, which we refer to as Section 23 schools, but there are teachers that are provided to go into care and treatment facilities. Those could be correctional facilities, hospitals, mental health facilities, which I take it is, but some sort of a facility where the children aren't able to leave each day. Those are an issue of the, it actually isn't the Board that provides the care or the treatment. So in this case, you said a mental health. It isn't the Board provides mental health. The Board simply provides the teaching for, send a few EAs for special education. Thank you. Supplementary? Yes, it's unfortunate back to the Minister of Education. It's unfortunate she's not more knowledgeable and briefed on Section 23 programs, but unlike the callous actions of the director of the school board, I do recognize the professional staff that I've dealt with at the Ministry of Community and Social Services and Children and Youth. However, we know that the Cortic Treatment Program was contracted for 36 children. I understand a new service will be reduced to just 24. Also, these treatments will no longer be provided to children in grades seven and eight. Furthermore, unlike the Cortic Treatment Program, the new service will not provide professional clinicians and psychiatrists to diagnose and treat the children. Speaker, will the minister confirm that these reductions are indeed factual? And if so, why the minister is allowing the school board question to serve their responsibilities and eliminate these much needed services? Thank you. Minister of Children and Youth Services. Minister Children and Youth Services. And I was actually glad to have a conversation with the member from Lanark, Frontenac, Lenox and Addington last week about the Cortic Education Centre as he knows it's a privately operated residence, but it is licensed by the Ministry of Children and Youth Services and a number of meetings have actually taken place earlier this year with the school board, with my regional staff, the local Children's Aid Society and the local mental health agency to discuss how to maintain the program at least till the end of the school year and allow for a proper transition of youth. It was Children's Mental Health last week, Speaker, we didn't have a huge opportunity to talk about that in the house. So I'll say now, as the minister responsible for Children's Mental Health, we want to make sure that children who need mental health services at the right time, at the right place, in a way that suits their needs. And that's why we've made substantial substantial investments in children. Thank you. And I'll be happy to talk to the member. Thank you. A new question to the member from Oboma, Manitou. Thank you, Mr. Speaker. Good morning to you. My question is to the Minister of Health and Long-term Care. Minister, my office has been overwhelmed this spring by constituents calling, worried about potential cuts to Matthew's Memorial Hospital and their emergency department located on St. Joseph Island. The possibility of reducing the current 24-hour emergency care to just 12 hours is deeply troubling to community members. I've heard from St. Joseph Island, Deborah, Bruce Mines and along the North Shore and other surrounding areas about how devastating this would be to our communities. Minister, patients and families deserve to know what's happening to our local hospital. Will the minister tell us exactly what cuts are on the table for Matthew's Memorial Hospital? Thank you. Mr. Speaker, I very much appreciate this question. It's our hospitals on a regular basis as they look to maintain and often improve services and to provide a sustainable healthcare environment. They look to different options and recommendations in terms of how they can modify services, but they do it. They're required to do it in a context where there's an expectation that the level of care is maintained or improved, that those important services to communities, particularly those that are served by Matthew's, that those services are maintained. So they do this work in concert with the Linn and the ministry as well. Any decisions, so any ideas that the administration or the board of that hospital might have, have to be then shared with the Linn and the Linn shares them with the ministry so that all three partners together with the community involved in the decisions. No decisions that I'm aware of, Mr. Speaker, have you made with regards to this particular hospital? Thank you. Supplementary? Again, to the minister of health and long-term care. Funding for hospitals in northern Ontario is simply inadequate, minister, and to make matters worse, small hospitals such as Blind River Thessalon and Matthew's Memorial who joined together with the goal of providing real, rural patient care do not have the funding to offer outpatient lab work. We have seen time and time again that northern patients are taking a backseat when it comes to proper health care. Minister, why is the government refusing to deliver stable, predictable funding that hospitals need to protect patient care for the people of northern Ontario? Thank you, minister. Well, Mr. Speaker, it's just not true that we're not supporting and investing in our hospitals in the northern part of this province. In fact, because many of them, not all of them, but many of them are small and rural, we have a dedicated fund of $20 million annually that goes to those hospitals. We've actually, the small rural hospitals are not part of the funding reforms that we made several years ago, and so they continue to be treated in a separate fashion, understanding the unique challenges that they might face. But across the north, whether it's Thunder Bay Hospital or Health Sciences North, or that cluster of small rural hospitals, we make sure that we're investing in them. But importantly, I'd like to speak to the member opposite. He hasn't, to my knowledge, brought this to my attention, or that of my staff for the ministry about Matthews Hospital. Again, I would simply implore all members of this legislature if they have a specific concern about a health care service in their, in their riding. Come to me. Thank you. Good question. The member from Northumberland, Quincy West. Well, thank you, Speaker. My question is to the Minister of Tourism, Culture and Sport. Minister, a few weeks ago, I was proud to join you, Minister, and Minister Lille at the Art Gallery of Peterborough to announce the recipients of this year's Celebrate Ontario grants. Celebrate supports local organizations by allowing festivals and events to build capacity. And I was pleased to hear that the Peterborough Music Fest received funding. This year marks the 30th year that Peterborough Music Fest has run on the picturesque shores of Little Lake. To this day, it remains a barrier-free festival with no social barriers and free attendance. Last year Celebrate Ontario supported an increased performance schedule which resulted in 20 percent increase in tourism. Through you, Mr. Speaker, I would like the Minister to tell the members of this House more important events supported as a result of Celebrate Ontario. Thank you, Minister of Tourism, Culture Well, thank you, Mr. Speaker. I'd like to thank the member for the question. And it's true, I was in Peterborough with the Minister of Agriculture at the Art Gallery and what a beautiful part of Ontario. Mr. Speaker, our government's Celebrate Ontario funds supported 200 festivals and events across Ontario, increasing attendance and maximizing their economic impact. A great example of the effect of Celebrate Ontario is our support for the Victoria Playhouse. Last year, the funding helped Victoria Playhouse surpass its attendance goals and attract more than $4.3 million in visitor spending for the Southwest Ontario region. Mr. Speaker, that's a story that's been repeated right across this province from Stratford Summer Music Festival to the Timmins Great Canadian Kayak Challenge and Festival to the Ottawa Blue Fest and Niagara Winter Festival of Lights. All across this great province, our government is supporting local organizations and building capacities for our festivals and events. Thank you, Mr. Speaker, and thank you, Minister. It is fantastically here, how wide-reaching and how successful our government's Celebrate Ontario fund is. My writing is home to other successful festival and events like the West Bend Arts Festival Theatre and Cultivate, a Festival of Food and Drink, along with Float Your Fanny Down the Ganny Speaker. In all 200 festivals and events received funding, events in Northern Ontario, in rural communities, and in Southwestern, and events all along the waterfront. In Sudbury, Speaker, and Thunder Bay, Leeds Grandville, and the Miscomene Cochrane. The members of this House know that Celebrate Ontario is wide-reaching and improves tourism. Mr. Speaker, through you to the Minister, can you tell the members of this House about how Celebrate supports tourism and provides platform for Ontario travelers? Thank you, Mr. Speaker. And again, I'd like to thank the member for the question. Each year, Mr. Speaker, we know that our festival and events here in Ontario through the Celebrate Fund helped to create jobs. In fact, since 2009, we've been able to create tens of thousands of jobs through this fund. And our target supports has led to an estimated 6.2 million in additional revenue and additional tourists coming back here to the province of Ontario. And Mr. Speaker, the tourism sector here in the province of Ontario is a $28 billion sector that employs over 350,000 people and many of them young people, Mr. Speaker. So we're so proud of tourism, we're so proud of our festivals and events, and we'll continue to make that investment through our Celebrate Ontario Fund so we can continue to ensure that we can tell our story, we can share our heritage. And of course, Mr. Speaker, add to the economic impact here in the province of Ontario. Thank you very much, Mr. Speaker. I'll ask the question to the member from Terry's family school. Thank you, Mr. Speaker. My question is to the Premier. Mr. Speaker, in a recent speech to the Timmins Chamber of Commerce, the CEO of Go West Gold, a junior mining company, called out your government for uncertainty in the current permitting process. No. Go West has been waiting since 2009 for all of their permits to be reviewed and either approved or denied by this government. I believe the Premier would agree that seven years is a very long time to wait for a project that will create jobs and contribute to Ontario's economy. Speaker, will the Premier explain why the permitting and approval process in Ontario is being allowed to stifle investment and preventing new mines from opening? Minister of Government and Consumer Services. Thank you very much, Speaker, and we certainly appreciate the question from the member opposite. As the member knows, Fullwell, Ontario is a leading jurisdiction in mining and mining development. There are millions of dollars that are generated from the industry and jobs created as a result of the investments made in the sector. Our Minister of Northern Development and Mines is working very hard with First Nations and mining companies to ensure that the permitting process is streamlined and is one that incents development and supports economic growth in the Province of Ontario when it comes to mining. We're pleased with the progress we've made and we know that there's more work to do and I know that the Minister of Northern Development and Mines is committed to doing that work. Thank you. There being no deferred vote, this house stands recessed until 3 p.m. this afternoon.


Hi everyone, Joe for JaspysCaseBreaks.com. Happy Tuesday, coming at you with 2020 Panini Prism Football. Cellopack Break number 94, giving away the final six spots that National Treasures Football Random Team Break. Should be pretty exciting. Big thanks everybody here for getting it on the action. I appreciate it. We're gonna do the break first. There are all the teams here. Let's roll it, let's randomize it. Six and a six, 12 times for names and teams. One, two, three, four, five, six, seven, eight, nine, 10, 11, and 12th and final time. Six and a six, 12 times for the teams. One, two, three, four, five, six, seven, five, six, seven, eight, nine, 10, 11, and 12th and final time. There's the first half of the list right here, and there's the second half of the list right there. Got a little ESPN Fancy preview on in the background, hoping to absorb some information here. It's already that time of year. All right, let's print and rip. Here's the final printout. Thanks everybody for making this filler break happen. Appreciate it. It's Hunter Renfro Green, Cam Acres, and Justin Herbert. Base rookie. It's not too shabby for a filler pack. Sean Matik with the Chargers. Let's see if he keeps up his impressive rookie campaign in a second year. Red, white, and blues. That'd be hashtag good for the hobby. John O'smith, Chris Carson, and Donovan Peoples-Jones. All right, now let's see who's gonna win those NT spots. Let's grab everyone's names again. There's some new dice. There's a new list. Let's pop everybody's names in there. And good luck. Let's roll it, randomize it. Three and a three, sixth the hard way. Top six after six. Good luck. One, two, three, four, five, and sixth and final time. So from seven on down, sad times. But I appreciate you giving it a shot. Thank you for taking the risk. Congrats to the top six happy times for Revital, PJ, PJ, PJ, PJ and Revital. That's how it works sometimes. Congrats, Revital and PJ. We'll see you in the next video for the break itself. Jaspy'scasebreaks.com, wow.


Hello and welcome to the session. This is Professor Farhad in which we would look at the equity method. This topic is covered in financial accounting, intermediate accounting and much, much more in depth in a course called advanced accounting. I do have intermediate and advanced accounting on my YouTube channel. This topic is also covered heavily on the CPA exam. As always, I would like to remind you to connect with me on LinkedIn if you haven't done so. YouTube is where you would need to subscribe. I have 1,700 plus accounting, auditing, tax and finance lectures. This is a list of all the courses that I covered, including many CPA questions. Connect with me on Instagram. Like my lectures, share them. If they benefit you, it means they might benefit other people. Also on my website, farhadlectures.com, you will have additional resources to supplement your accounting education or study for the CPA exam. A lot of multiple choice through faults, exercises, notes, PowerPoint slides to supplement your education. The prerequisite for this recording, because this is about investments, you can check for the prerequisite in the description. So let's talk about equity investments. So when we invest in equity, when we buy stocks, how do we account for those investments? So when company A buys stocks in company B, whether it all depends on your ownership level, do you own less than 20%? If you own less than 20%, we will use either the cost or the market value method, because here we are assuming you have insignificant or you lack significant influence. Simply put, you have no saying in the company. If you own less than 20% of a particular company, you have no saying in that company. Therefore, it's you lack significant influence and this is the method that we looked at in the prior session. You could look at the description. If you own between 20 to 50%, you would use something called the equity method. Now this is what we're gonna be looking at today, the equity method. Here you assume to have significant influence. Here you have significant influence. What does that mean? It means you can vote the board of directors, you can vote yourself to be one, you can maybe get a position in management, so you have some influence, therefore you would use the equity method. If you own more than 50%, well here once you own 50% plus, you become the majority shareholder. Now you have to consolidate the financial statements and this is what you would learn in my advanced accounting course where you would learn about consolidation and we don't cover this in financial accounting, this is an introductory course. So how do we account for investments and equity securities with significant influence? Well, in this course, it's pretty simple, but it's very important that you learn the simple, learn the basics, because once you learn the basics and intermediate, we don't add that much to this topic, but believe me in advanced accounting, we're going to add a lot about this equity method. So the first thing is when you buy the investment, just like every other investments, every other assets, it's initially recorded at cost, then the investment, that investment is increased, it's gonna increase by the proportionate share of the investee's earning, huh? What does that mean? It means you're gonna wait until your investee, the company that you invested in, report their earning. And if you own 30% of the company, you're gonna increase your investment by 30% of the earning that they reported. Guess what? If they report losses, you're gonna reduce your investments by 30% of their losses, then you are going to decrease your investment account by dividend received. So let me show you that the account will explain this later, little bit more in details. So this is what we have. We have an account called investment in equity. So you have some sort of an equity investments, and here's what's gonna happen. Every time you have net income, it's gonna increase your investments. Every time you have a net loss, it's gonna reduce your investment. And every time you have dividend, it's gonna reduce your investment. Don't worry, we'll explain why dividend reduce your investment shortly when we work with numbers. It's easier to see it with numbers. So let's take a look at an example to see how this all fits. First, you're gonna buy an investment. January 1st, micron record a purchase of 3000 shares, representing 30% of star common stock at a total of 70,650. Now here's what I want you to kind of look for the first.  It means you're gonna be using the equity method. On the CPA exam or in the homework, they may not tell you explicitly you're gonna be using the equity method. They assume since it's 30%, you're gonna be using the equity method. So let's take a look at the journal entries. First one we purchased. Simply put, we debit the investment, long star investment, long-term investment star and credit cash, basically recorded at cost. Now what we do, we wait until star reports their earning and star reported $20,000 in net income and they paid out half of them in cash dividend, which is 10,000. So remember, when they report net income, we qualify for 30% of that. Basically it's our net income. And what's gonna happen with that 20,000 times 30%, that's 6,000. We are going to increase our investment by 6,000. So we're gonna increase this investment by 6,000. And then on the second slide, we're gonna see all the T-account entries. And we're gonna credit basically an earnings account, earnings from long-term investments, $7,000. That's done. Now, they also paid us $10,000 in cash dividend. How much are we going to get? We're gonna get 30% of that, which is $3,000. Excellent, we're gonna debit cash $3,000. What are we going to credit? Well, the key here is to remember we're using the equity method. What does that mean? Remember what we said, when you receive dividend, it's gonna reduce your investment. And the answer is why? Well, here's why. Here's what they did. Remember, dividend, this cash, this $3,000 cash is coming from your earnings. It's coming from net income. All what they did is they're giving you $3,000 in cash, which means they are, okay, it's coming from your revenue or it's coming from your asset. It's coming from assets and revenue that you generated in your investing. Now, all what they're doing is they're giving you the cash. So what they did, they took the investment that you have in their company and turned part of it into cash. So of the $6,000 that you had in your investment, they paid it out in cash. Well, you did receive the cash, that's excellent. But you cannot consider this revenue again. You cannot say, I'm gonna credit dividend revenue because if you say I'm gonna credit dividend revenue, then your revenue equal to 9,000. Why 9,000?  Therefore, it's not dividend revenue. All what they're doing is they're giving you the earnings that you already earned and recorded as revenue. So it's the credit is long-term investments. Therefore, they're reducing your investments. Well, that's the bad news. The asset going down. Well, the good news is they gave you cash. The asset goes up. So it's that $6,000 that you have. Simply put, you have money in the bank. You have $10,000 in the bank. You went to the ATM machine and you would drew $500. Now you have $500 in your pocket. It's the same thing. You still have 10,000. The bank account is 9,500. Now the bank has, you have in your account 9,500, but in your pocket you have 500, so you still have 10,000. Same concept. You already recorded that earnings. All what they're doing now is giving you the earnings in cash. So remember that. That's why you will credit long-term investments. So you reduce your long-term investments. Now let's take a look at the T account what we did in this whole thing. This is the investment account. This is the beginning. You, when you purchased it at cost, you add the net earnings and the balance became 76,750. Then you're reduced it by 3,000 by the amount of dividend. The ending balance is 73,650. Now sometime on the exam or on the homework, we're gonna tell you, you sold this investment for 80,000. If you sold this investment for 80,000, your proceeds are for 80,000. Then you have a gain for the difference. So remember the difference now, the balance is 73,650. So be careful about this. Let's take a look at another example to kind of consolidate what we just learned. Prepare the, prepare entries to record the following transaction of Garcia company. Okay, the Garcia company, they purchased 400 shares of Lopez. So Garcia company, we call Garcia company is the parent company. We share Lopez as the subsidiary. Or Garcia is also called the investor. And Lopez is the investee. Okay, so they purchased 400 shares of the common stock for 3,000. Lopez has 1,000 shares of common stock outstanding and its policies will be slightly influenced by Garcia. Here they gave you a hint that you're gonna have significant influence. And think about it, if you bought 400 out of 1,000, you own 40% now of Lopez, which is, you have to use the equity method. Lopez declared dividend at $2 per share. They announced their income of 2,500. And this is in year one. In year two, they declared and paid dividend. And they declared their income. Then Garcia sold 100 shares for 1300. So we're gonna have to journalize these entries. Basically that's what we are being asked to do. Now keep in mind, here's what we have. We have the long-term investments. So under, this is what Garcia. Garcia will have a long-term investments in Lopez. And Lopez, the investee will report the earnings. So here's what's gonna happen. Lopez will earn that income. That's fine. Then they will generate net loss and retained earning. Then they will pay dividend and retained earnings. So this is what the investee does. So when they have income, retained earning goes up. When they have a net loss, retained earning goes down. When they have dividend retained earnings goes down.  You know, in our situation, 40% of net income. The net loss reduces Lopez investment by that percentage, 40% and dividend reduces Lopez investments. So let's take a look at the transactions and see how they all fit together, just kind of journalize them. First, we purchased 400 shares for 3000. We debit long-term investments in Lopez 3000 and we credit cash 3000. Now the second thing is they pay dividend. Well, this is the entry. Let's look at the entry for each one. So the retained earnings is whatever the retained earnings is. Now Lopez, the first thing is, let's look at the T-account. The T-account for Lopez is established long-term investments for 3000, okay? Now, Lopez declared and pay cash dividend of $2.00. When they pay cash dividend, their retained earnings goes down. Debit and we receive 40% of that. We received 40% of that. We is Lopez. So we're gonna debit cash 400 shares times $2.00, $800. And we're gonna reduce Lopez investments. Remember, every time the investee pays dividend, it's a reduction in our investment because our investee is reducing their value. Basically, we reduce our value proportionally. Then they have a net income of 2500. Remember that income, it's gonna increase Lopez's retained earnings and that's gonna increase our investment by 40% of 2500, which is $1,000. Debit our investments, credit the earnings. So this is basically, we purchased it, we received dividend, we recorded the net income. So basically here, we increase our investment. Now this is the balance. Now we can compute this. How much is the balance? It's 4,000 minus 800. The balance is 3,200. Now, remember that for year two, we declared and paid dividend of 225, a total of 2250. Once again, we're gonna receive 40% of that, which is 400 shares times 225. In cash, we reduce the investment by 900. We reduce the investment by 900. Then the company generated 2,750 of earnings. Lopez retained earnings goes up. Our investment goes up by 40%, which is 2750. I'm sorry, of 2750, which is 1,100. So this is for year two. Notice we now we could compute the new balance for the investment. So we add 3,000 plus 1,000 plus 1,100, which is 5,000, 5,100 minus 1,700. And this will be the balance. Now we sold, Garcia sold 100 shares. Now actually I'm gonna have to do this computation because we have to kind of know what we're doing here. So let me do the computation. Then, and you're gonna see why I did this is because I wanna show you when we sold 100 shares, we sold 1 fourth or 25% of it. So we have 5,100 minus 1,700. The balance is 3,400. Now what we did is we sold of the balance is 3,400. We sold 0.25, 1 fourth of that. So we multiply this by 0.25. We sold 850 of our investments for 1,300. Therefore we have a gain. So we're gonna debit cash 1,300 for the cash. Credit, low pass, long-term investments. Again, 25%, 1 fourth of 3,400, 850. Then the difference is a gain. So notice we did not sell the whole investment. We sold, we did not sell the whole investments. We sold 1 fourth of it. 1 fourth of it, we got more than the cost of it. Therefore we have a gain, excellent. And this is an actual gain that goes on the income statement. If you like this recording, please like it, share it, put it in playlist as always. I would like to invite you to visit my website for additional resources, especially if you're studying for your CPA exam. I can get you those seven to 15 extra points that you're looking for to pass the exam, put it behind you. Study hard for your accounting courses. Accounting is worth it, good luck. And in the next recording, we would look at accounting for international operation. Good luck and stay safe.


She says Arthur was in a medically induced coma and put on a ventilator after three months though. He woke up When's the last time you saw somebody who's in a coma? We're in glasses What do you need glasses for I wear glasses? I've never been in a coma, but I don't think I'm gonna need them if I'm in a coma Think about that. You've got to be kidding me And then neither one of them said you know what we can't show that picture Why because I wear my glasses. Oh, yeah, I just don't I Can't I can't get down with this guy man. I think this is a bit it has to be a bit you guys. I'm telling you