Codger Limited Acquired a 40% Investment in Lodger Limited for €50

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)
$\begin{array} { l l l } \text { DR } & \text { Cash } & € 4000 \\& \text { CR Investment in associate } & € 4000\end{array}$
B)
$\text { DR Dividends payable } \quad € 4000$
$\text { CR Cash } \quad € 4000$
C)
$\begin{array}{lll}\text { DR } & \text { Cash } & € 4000 \\\text { CR} & \text { Dividend revenue } & € 4000\end{array}$
D)
$\begin{array}{ll}\text { DR Investment in associate } & € 4000 \\\text { CR Dividend revenue } & € 4000\end{array}$

Correct Answer:

Verified

Unlock this answer now
Get Access to more Verified Answers free of charge

Access For Free