1.9 Mozart Ltd acquired 25% of shares and significant influence over the operations of Liszt Ltd on 1 January 20X0. Both companies have financial years ending 31 December. Liszt Ltd reported a profit of $80,000 and paid a cash dividend of $0.04 per share. Liszt Ltd has issued 1 million ordinary shares. Under equity accounting, by how much would the Investment in Liszt Ltd account change for the year ended 31 December 20X0?

Select one:

increase of $40,000

decrease of $40,000

decrease of $20,000

increase of $10,000

2. According to AASB 128, the main evidence of significant influence, through an investors power to participate in policy setting, could be:

Select one:

actual participation in policy making.

any or all conditions in this list.

representation on the associates governing body.

material transactions between investors and associate.