Question
On January 1, 2019, an entity acquired 30% of the voting share capital of another entity for P2,000,000 which was equal to the carrying amount
On January 1, 2019, an entity acquired 30% of the voting share capital of another entity for P2,000,000 which was equal to the carrying amount of interest acquired. The investee reported net income of P1,500,000 for 2019 and paid dividend of P500,000 on December 31, 2019.
The investee reported net income of P1,000,000 for the six months ended June 30, 2020 and P2,500,000 for the year ended December 31, 2020 but paid dividend of P1,000,000 on October 1, 2020.
On July 1, 2020, the investor sold half of the investment of P2,000,000. The fair value of the retained investment is P2,200,000 on July 1, 2020 and P2,400,000 on December 31, 2020. The retained investment is to be measured at FVPL.
What amount of gain on sale of investment should be reported for 2020?
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started
Accounting Information Systems
Authors: George H Bodnar, William S Hopwood
10th Edition
013609712X, 978-0136097129
