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What amount of unrealized gain should the company disclose

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On January 1, 2020, January Company purchased debt instruments of February Company with a face value of P5,000,000 bearing interest rate of 8% for P4,621,006 to yield 10% interest per year. The bonds mature on January 1, 2024 and pay interest annually on December 30. On December 31, 2020 the fair value of the investment is P4,838,014 which is based on the prevailing market rate of 9%.

Problem 1: If the investment is designated as FVOCI, what amount of unrealized gain or loss should the company disclose in their December 31, 2020 other comprehensive income?

a. P26,559 unrealized gain
b. P154,907 unrealized gain
c. None
d. P217,008 unrealized gain

Reference no: EM132760276

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