On January 2, 2019, Single Corporation purchased 5-year 10%% bonds of Taken Co., with face value totalling to P5,000,000, at 92. Single incurred an additional P39,500 as direct costs, resulting to a yield rate of 12%. Interest is paid by Taken every December 31. The bonds are quoted on December 31, 2019 and 2020, at 95 and 91, respectively. The entity sold the bonds on January 3, 2021 at 92. Requirements: Case 1 - The company has a business model of holding the financial asset to collect contractual cash flows consisting of principal payments and interest payments on the outstanding principal. 1. What is the initial cost of the investment? 2. How much income related to the investment must be presented in the 2019 income statement? 3. What is the carrying value of the investment as of December 31, 2020? 4. How much is the gain or loss on disposal? Case 2 - The company has a business model of holding the financial asset to collect contractual cash flows consisting of principal payments and interest payments on the outstanding principal, and to sell the financial asset. What is the initial cost of the investment? 2. What is the carrying value of the investment as of December 31, 2019? 3. How much unrealized gain or loss must be presented as a component of other comprehensive income for 2019? 4. How much unrealized gain must be presented in the statement of financial position as of December 31, 2020? 5. How much is the gain or loss on disposal? Case 3 - The company carried the financial asset at fair value through profit or loss. 1. What is the initial cost of the investment? 2. How much income related to the investment must be presented in the 2019 income statement? 3. How much income related to the investment must be presented in the 2020 income statement? 4. What is the carrying value of the investment as of December 31, 2020? 5. How much is the gain or loss on disposal