Problem 1

1
Net income for 2019 2000000
Unrealized profit on sale of equ -300000
Realized profit on equipment sol 30000
Adjusted net income 1730000

Investor's share 692000

2
Net Income for 2020 3000000
Realized profit on of equipment 30000
Unrealized profit on sale of eq -400000
Realized profit on of equipment 40000

Unrealized profit on ending in -800000

Adjusted net income 1870000

Inveator's share 748000

3
2019
Jan-01 Investment in associate 5000000
Cash 5000000

Dec-31 Investment in associate 692000

Investment income 692000

31 Cash 320000
Investment in associate 320000

2020
Dec-31 Investment in associate 748000
Investment income 748000

31 Cash 400000
Investment in associate 400000

4
Acquisition cost 5000000
Investment income-2019 692000
Cash dividends-2019 -320000
Investment income-2020 748000
Cash dividends-2020 -400000
Carrying amount 5720000
Problem 2

1
Acquisition cost 3200000
Net assets aquired -1800000
Excess of cost 1400000
Excess attributable to equipment -900000
Goodwill 500000

2
Net income for 2019 4000000
Unrealized profit -600000
Adjusted net income 3400000

Investor's share 1020000

Amortazation of excess attributable to equipment -180000
Investment income 840000

3
Invesment in associate 3200000
cash 3200000

Invesment in associate 840000

Invesment income 840000

Cash 450000
investment in associate 450000

Investment in associate 600000

Revaluation surplus 600000

4
Acquisition cost 3200000
Investment income 840000
Cash dividends -450000
Revaluation surplus 600000
Carrying amount 4190000
Problem 3

1
Mar-01 Trading securities 1860000
Interest income 20000
Cash 1880000

Apr-01 Trading securities 3800000

Interest income 40000
Cash 3840000

Aug-01 Cash 120000

Interest income 120000

Sep-01 Cash 240000

Interest income 240000

Oct-01 Cash 1060000

Interest income 10000
Trading securities 950000
Gain on sale of trading securities 100000

Sales price 1050000

Less:Cost of bonds sold 950000
Gain on sale 100000

Dec-01 Cash
Trading securities 2080000
Interest income 1860000
Gain on sale of trading securities 80000
140000

Sales price 2000000

Less: Cost of bond sold 1860000
Gain on sale 140000

31 Accrued interest recievable 120000

Interest income 120000

31 Unrealized loss-TS 150000

Trading securities 150000

2
Current assets
Trading securities at fair value 2700000
Problem 4
1
Bond Months Peso
Bond year Outstanding Outstanding Month
2020-2021 3000000 4 12000000 12\48
2021-2022 2000000 12 24000000 24\48
2022-2023 1000000 12 12000000 12\48
48000000

2
2020
Oct-01 Investment in bonds 2700000
Interest income 60000
Cash 2760000

Dec-31 Accrued interest recievable 150000

Interest income 150000

31 Invesment in bonds 56250

Interest income 56250

2021
Jan-01 Interest income 150000
Accrued recievable 150000

Feb-01 Cash 180000

Interest income 180000

1 Cash 1000000
Invesment in bonds 1000000

Aug-01 Cash 120000

Interest income 120000

Dec-31 Accrued interest recievable 100000

Interest income 100000

31 Investment in bonds 156250

Interest income 156250

From January to February 18750

From February to December 137500
Total amortization 156250
Discount
Amortization
75000
150000
75000
300000
Problem 5
1
Investment in bonds 7679000
Cash 7679000

Cash 800000
Interest income 800000

Investment in bonds 121480

Interest income 121480

Interest income 921480

Interest received 800000
Discount amoritization 121480

Cash 2000000
Investments in bonds 2000000

2
Cost 7769000
Discount amortization 121480
Annual installment -2000000
Carrying amount 5890480
Problem 6
Discount Carrying
Date Interest received Interest income amortization amount
2020 4742000
2020 300000 379360 79360 4821360
2021 300000 385709 85709 4907069
2022 300000 392931 92931 5000000

Interest received 6%
Interest income is 8%

2020
Jan-01 Financial asset FVOCI 4742000
cash 4742000

Dec-31 Cash 300000

Interest income 300000

31 Financial asset FVOCI 79360

Interest income 79360

31 Financial asset FVOCI 428640

Unrealized gain OCI 428640

Market value 5250000

Carrying amount -4821360
Unrealized gain 428640

2021
Dec-31 Cash 300000
Interest income 300000

31 Financial assets FVOC 85709

Interest income 85709

31 Financial assets FVOC 164291

Unrealized gain OCI 164291

Market value 5500000

Carrying amount per table -4970069
Cumulative unrealized gain 592931
Unrealized gain 428640
Increase in unrealized gain 164291
 2022
Dec-31 Cash 300000
Interest income 300000

31 Financial assets FVOCI 92931

Interest income 92931

31 Cash 5000000
Unrealized gain OCI 592931
Financial assets FVOCI 5592931