OLPROFE06 ACTIVTY 4

1. The amount of investment to be reported as current assets is

Ans. P2,455,000
Solution
Security A P725,000 at mv
Security B 200,000 at mv
Security C 560,000 at mv
Security E 970,000 at cost
Total P2,455,000

2. Based on Problem in Question 1, The amount of investment to be reported as

non-current assets is
Ans. P1,277,000
Solution
Security D P865,000 at mv
Security F 412,000 at cost
Total P1,277,000

3. Based on Problem in Question 1, The unrealized gain (or loss) component of

income before taxes is
Ans. 15,000
Solution:
Trading securities – cost P910,000
Trading securities – mv 925,000
Holding gain 15,000

4. Based on Problem in Question 1, The unrealized gain (or loss) component of

shareholders’ equity is
Ans. 75,000
Solution:
Available for sales security – cost P1,350,000
Available for sales security – mv 1,425,000
Holding gain P75,000