Question
Milk Tea Company purchased 10% of Matcha Companys 100,000 outstanding ordinary shares on January 1,2021 for P500,000. These equity investments were classified by Milk Tea
Milk Tea Company purchased 10% of Matcha Company’s 100,000 outstanding ordinary shares on January 1,2021 for P500,000. These equity investments were classified by Milk Tea Company as at FVPL. On December 31, 2021, the market value of these equity investment was P650,000. On January 1, 2022, Milk Tea Company purchased additional 20,000 shares of Matcha Company for P1,300,000. Matcha Company had not issued additional shares during the year 2022. For the year 2022, Matcha Company reported profit of P1,000,000 and paid cash dividends of P300,000. On December 31, 2022, the market value of these investment is P 2,600,000 What amount should Milk Tea Company, report in its December 31, 2022 statement of financial position as investment in Matcha Company
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