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Waffles Ltd acquired a 20 per cent interest in Iron Ltd on 1 July 2021 for a cash consideration of $146.000. Waffles Ltd has
Waffles Ltd acquired a 20 per cent interest in Iron Ltd on 1 July 2021 for a cash consideration of $146.000. Waffles Ltd has a sufficient balance of voting rights in Iron Ltd to give it significant influence in its operating and financing decisions. Iron Ltd's assets and liabilities were recorded at fair value at the time of purchase and were represented by equity as follows: Share capital Retained earnings Total shareholders' funds 500 000 230 000 730 000 During the year ended 30 June 2022 the following events occurred: Iron Ltd had an after-tax profit of $248 000. Iron Ltd declared and authorised a dividend of $50 000 which was paid later in the same year. Later in the year Per Ltd declared and authorised a further $50 000 dividend out of current year profits. This dividend will not be paid until the following year. Waffles Ltd accrues the dividends of associates as revenue when they are declared and authorised. What is the amount of the investment in Iron Ltd that will be recorded in the books of Waffles Ltd as at 30 June 2022 when Waffles is (i)a consolidating entity and (ii) non-consolidating entity using the cost method? O $175,600 $146,000 $195,600 $175,600 $185,600 $126,000 $146,000 $156,000 None of the other options
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