Question
Codger Limited acquired a 40% investment in Lodger Limited for $50 000. Lodger declared and paid a dividend of $10 000. Codger Limited does not
Codger Limited acquired a 40% investment in Lodger Limited for $50 000. Lodger declared and paid a dividend of $10 000. Codger Limited does not prepare consolidated financial statements. The appropriate entry for the investor to record this dividend is:
a. | DR Cash $4 000 CR Investment in associate $4 000 | |
b. | DR Dividends payable $4 000 CR Cash $4 000 | |
c. | DR Cash $4 000 CR Dividend revenue $4 000 | |
d. | DR Investment in associate $4 000 CR Dividend revenue $4 000. |
The following are regarded as factors indicating the existence of significant influence over another entity:
| I | II | III | IV |
representation on the board of directors | Yes | Yes | Yes | Yes |
participation in decisions about dividends | No | Yes | Yes | Yes |
interchange of managerial personnel | No | No | No | Yes |
ability to control the investees operating policies | No | Yes | No | No |
a. | I. | |
b. | II. | |
c. | III. | |
d. | IV. |
According to AASB 107/IAS 7 Statement of Cash Flows, which of the following items does NOT fall within the definition of cash?
a. | Bank notes and coins. | |
b. | Non-bank bills that are readily convertible to cash. | |
c. | Deposits on the short-term money market with a term of less than 3 months. | |
d. | Accounts receivable. |
During the financial year, Cresswell Limited had a cost of sales amounting to $260 000. Opening and ending balances of related accounts were:
Opening balance Closing balance
Inventories $46 000 $55 000
Accounts Payable $18 000 $26 000
A discount of $2000 for prompt payment was received. The amount of cash paid for goods purchased during the year was:
a. | $259 000. | |
b. | $263 000. | |
c. | $275 000. | |
d. | $279 000. |
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