Reference no: EM133186053

Questions -

Q1. Knowie Company owned 50,000 ordinary shares of Bergs Company. These 50,000 shares were purchased by KNOWIE for P100 per share and classified as FVOCI. Knowie was entitled to buy one new share of Bergs Company for P80 cash and 4 of these rights. On August 30, Bergs distributed 50,000 share rights to Knowie and on this date, the market value per share is P120 and the market value per right is P30. What total cost should be recognized for the new shares that are acquired by exercising the rights?

Q2. Bergs Company and its subsidiaries own the following properties:

Land held for undetermined use- P1,500,000

Land held for long-term capital appreciation- P2,800,000

Land held by a subsidiary for short-term sale in the ordinary course of business- P5,000,000

A vacant building owned by the company and to be leased out under an operating lease- P2,000,000

Building used in production- P4,500,000

Building owned by subsidiary and leased out to third parties under an operating lease- P3,200,000

Land leased by Bergs Company to subsidiary under an operating lease- P2,500,000

Building under construction for future use an investment property- P3,600,000

Based on the provisions of IAS 40, what amount should be reported as Investment Property in the separate financial statements of Bergs Company?