Reference no: EM133158596

Question 1 - On January 1, 2020, Second Company has acquired 2,000 shares of another company at P10 per share. The cost of investment includes transaction costs P1.5 per share. The company opted to present this investment at fair value through other comprehensive income irrevocably. At the end of 2020, the market price of the shares is P15 per share and this was sold at P18 per share on January 2, 2021. How much gain/(loss) should be recognized in the statement of financial position as of December 31, 2020?

Question 2 - The 2019 financial statements of Third company showed that they have a financial assets at FVOCI with a carrying value of P25,000 and according to the notes to financial statement, this investment was purchased at P28,000 not a long time ago. On May 5, 2020, third sold 30% of this investment at P10,000. As of December 31, 2020, the remaining shares have a market price of 10% less than its carrying value as of the previous year. The said decrease in market value is deemed other than temporary. How much is the gain/(loss) on the sale of investment?