Chile Company acquired 30% of Santiago Companys voting share capital for P2,000,000 on January 1,2020. Chiles 30%

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Question:

Chile Company acquired 30% of Santiago Company’s voting share capital for P2,000,000 on January 1,2020. Chile’s 30% interest in Santiago gave Chile the ability to exercise significant influence over Santiago’s operating and financial policies. During 2020, Santiago earned P1,500,000 and paid dividends of P500,000. Santiago reported earnings of P1,000,000 for the six months ended June 30, 2021, and P2,500,000 for the year ended December 31, 2021 but paid dividend of P1,000,000 on October 1, 2021.On July 1,2021, Chile sold half of the investment in Santiago for P2,000,000 cash. On such date, the investment is measured at fair value through profit or loss. The fair value of the retained investment is P2,200,000 on July 1, 2021 and P2,400,000 on December 31, 2021.

1. What amount should be recognized as investment income for 2020 as a result of the investment?

2. What is the carrying amount of the investment on December 31, 2020?

3. What is the Gain from remeasurement to fair value in 2021?

4. What is the Gain on sale of investment in 2021?

5. What total amount of income should be reported for 2021?