Reference no: EM132833183

Question - At the beginning of current year, Croatia Company acquired 20% of the outstanding ordinary shares of an investee for P7,000,000. This investment gave Croatia Company the ability to exercise significant influence over the investee. The carrying amount of the acquired net assets was P6,000,000.The excess of cost over carrying amount was attributed to an identifiable intangible asset which was undervalued on investee statement of financial position and which had a remaining useful life of 10 years. The investee reported net income of P1,800,000 for the current year and paid cash dividend of P600,000 on the ordinary shares. What is the carrying amount of the investment in associate at year-end?