How much investment income is recognized by Beyonce on the sale of 2,000 stock rights?

Financial Accounting
14th Edition
ISBN:9781305088436
Author:Carl Warren, Jim Reeve, Jonathan Duchac
Publisher:Carl Warren, Jim Reeve, Jonathan Duchac
Chapter15: Investments And Fair Value Accounting
Section: Chapter Questions
Problem 28E
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Beyonce Company purchased 10,000 shares of Taylor company's ordinary shares at P80 per share
in 2021. Beyonce designated the equity investment as at FVPL. Fair value at Dec. 31, 2021 was
P100/ share. In 2022, Taylor issued rights to its shareholders to purchase one ordinary share for
every five rights plus P70.
Beyonce sold 2,000 stock rights at P10 and exercise the remaining rights by purchasing
additional shares.
How much investment income is recognized by Beyonce on the sale of 2,000 stock rights?
Transcribed Image Text:Beyonce Company purchased 10,000 shares of Taylor company's ordinary shares at P80 per share in 2021. Beyonce designated the equity investment as at FVPL. Fair value at Dec. 31, 2021 was P100/ share. In 2022, Taylor issued rights to its shareholders to purchase one ordinary share for every five rights plus P70. Beyonce sold 2,000 stock rights at P10 and exercise the remaining rights by purchasing additional shares. How much investment income is recognized by Beyonce on the sale of 2,000 stock rights?
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