When an investor uses the equity method to account for investments in common stock, the investors share of cash dividends from the investee should be recorded as a. A deduction from the investors share of the investees profits. b. Dividend income. c. A deduction from the stockholders equity account, Dividends to Stockholders. d. A deduction from the investment account.
Chapter 1, Problems #1
When an investor uses the equity method to account for investments in common stock, the investor’s share of cash dividends from the investee should be recorded as
a. A deduction from the investor’s share of the investee’s profits.
b. Dividend income.
c. A deduction from the stockholders’ equity account, Dividends to Stockholders.
d. A deduction from the investment account.
This problem has been solved!
Do you need an answer to a question different from the above? Ask your question!
Answer
The correct answer is b. Dividend income. The equity method is an accounting technique used by inves…View the full answer
Related Book For 
Advanced Accounting
13th edition
Authors: Joe Ben Hoyle, Thomas Schaefer, Timothy Doupni
ISBN: 978-1259444951