Reference no: EM132828252

Questions -

Q1. On January 1, 2009, Bing Company purchased 30,000 shares of Latt Company's 200,000 outstanding ordinary shares for P 6,000,000. On that date, the carrying amount of the acquired shares on Latt's books was 4,000,000. Bing attributed the excess of cost over carrying amount to patent. The patent has a remaining useful life of 10 years. During 2009, Bing's officers gained a majority on Latt's board of directors. Latt reported earnings of 5,000,000 for the year ended December 31, 2009, and declared and paid dividend of P 3,000,000 during 2009. On December 31, 2009, Latt's ordinary share was trading over-the-counter at P15. What is the carrying value of the investment in Latt Company on December 31, 2009?

Q2. On January 2, 2012, Gamu Company purchased as a long term investment 10,000 ordinary shares of Ilagan Corporation for P70 per share, which represents a 1% interest. On July 1, Ilagan Corporation declared its annual dividend on its ordinary shares of P5 per share payable on August 1 to shareholder's of record at July 25, 2012. On July 20, 2012 Gamu needed additional cash for operations and sold all 10,000 shares Ilagan for P100 per share. For the year ended December 31, 2012, Gamu should report on its income statement a gain on disposal of ____________________.