1) On April 1, 2020, Lucky Company acquired Wishful Corp. bonds held as financial asset at amortized cost, face P2,000,000 at a cost of P1,940,500 including accrued interest. Bonds pay interest of 12% semi-annually on January 1 & July 1 & mature on January 1, 2024. The bonds have effective yield of 14%.

How much is theAcquisition cost of investment on April 1, 2020

2) On January 1, 2019, Happy Company acquired 20% of the ordinary shares of an associate for P3,000,000. On this date, all identifiable assets and liabilities of the associate were recorded at fair value.

An analysis of the acquisition showed that goodwill of P300,000 was acquired. The associate reported the following net income and dividends:

Net income

2019- 1,500,000

2020- 2,000,000

Dividends paid

2019- 500,000

2020- 750,000

In December 2019, the associate sold inventory to Happy for P450,000. The cost of inventory was P300,000.

The inventory remained unsold by happy on December 31, 2019. However, it was sold by Happy in 2020.

In December 31, 2020, the associate sold inventory to Happy for P375,000. The cost of inventory was P250,000. The inventory remained unsold by Happy on December 31, 2020.

a. What is investor's share in the profitof the associate for 2019?

b. What is the investor's share in the profit of the associate for 2020?

c. What is the carrying amount of the investment in associate on December 31, 2020?

3) On May 1, 2019, Lucky Company purchased 12% P3,000,000 face value bonds for P3,360,000 plus transaction costs of P120,000 to be held as financial assets at amortized cost. Interest is payable semiannually on May 1 and November 1.The bonds will matureon May 1, 20Lucky Company sold all the bonds on August 31, 2020at 97 pusaccrued interest.The entity adopt the calendar year and uses the straight line method of amortization.

a. What amount should be recognized as investment income for 2020?

b. What is the carrying amount of investment on December 31, 2020?

c. What total amount of income should eb reported for 2021?