At the beginning of current year $2018,$ Gala Company purchased equity securities for P$5,200,000.$ The entity also paid

commission, taxes and other transaction costs amounting to P$200,000.$ The securities are quoted at P$5,500,000$ at year$-$end.

No securities were sold during the year. The transaction costs that would have been incurred on the disposal of the

investment are estimated at P$100,000.$

In $2019,$ no securities were sold. The quoted price of the securities end of $2019$ is P$4,500,000.$

In $2020,$ half of the securities was sold at a selling price of $2,500,000.$ The entity incurred disposal costs worth P$30,000.$ The

remaining securities are quoted at P$2,750,000$ at year end.

Required:

A$.$ Provide journal entries to record the above transactions:

$1.$ Assuming the entity has elected irrevocably to present changes in fair value in other comprehensive

income.

$2.$ Assuming the equity securities are held for trading.

B$.$ Compute the carrying value of the financial assets as of:

$1.$ January $1,2018.$

$2.$ December $31,2018.$

$3.$ December $31,2019.$

$4.$ December $31,2020.$

C$.$ Assuming the securities are carried at fair value through OCI, what is the balance of the cumulative gains or

losses presented as a component of stockholders$$ equity as of:

$1.$ December $31,2018.$

$2.$ December $31,2019.$

$3.$ December $31,2020.$

D$.$ Assuming the securities are held as trading securities$,$ determine the amount presented as a component of

profit or loss as a result of change in fair value in periods:

$1.2018.$

$2.2019.$

$3.2020.$