On January 1, 2020, Covid Company purchased P1,000,000, 12% bonds of Lugaw Company for P1,063,394, a price that yields 10%. Interest on these bonds is payable every December 31. The bonds mature on December 31, 2023. On April 1, 2022, to pay a maturing obligation. Covid sold P600,000 face value bonds at 101 plus accrued interest. Market Value of the bonds on different dates is as follows:

• December 31, 2020 108
• December 31, 2021 106
• December 31, 2022 104

Assume that the bonds were classified as DEBT INVESTMENTS AT FAIR VALUE THROUGH PROFIT OR LOSS.

1.How much is the interest income for the year ended December 31, 2020?

2.What amount of gain or loss should Covid report on the sale of the bond investments on April 1, 2022?

3.At what amount should the bond investment be shown on December 31, 2021 and December 31, 2022 statement of financial position?