LETTUCE CO. purchased 40% of MU Corp. on April 1, 2012, for P500,000 when MU's book value

was P1,260,000. On the date of acquisition, the market value of MU's net assets equaled their

book values except for the following:

MU's equipment has a fair value of P50,000 less than its book value. The equipment has

a remaining useful life of 10 years.

MU's building has a fair value of P40,000 than its book value. The building has a

remaining useful life of 20 years.

MU's results of operations in 2012 and 2013 are as follows:

2012 net income 150,000

2013 net loss 30,000

MU paid cash dividends of P20,000 and P10,000 in 2012 and 2013, respectively.

What amount of investment income should be reported on Lettuce Company's income

statement for the year ended December 31, 2012?

A. 44,100

B. 58,800

C. P61,200

D. 45,900

The investment loss to be reported on Lettuce Company's 2013 income statements

A. 10,800

B. 8,100

C. 13,200

D. 12,000

What is the carrying value of the stock investment on December 31, 2012?

A. 536,100

B. 537,900

C. 553,200

D. 500,000

What is the carrying value of the stock investment on December 31, 2013?

A. 521,300

B.536,000

C. 523,100

D. 500,000