When an Investor Uses the Cost Method to Account for Investments

question 20

Multiple Choice

When an investor uses the cost method to account for investments in common stock,cash dividends received by the investor from the investee should normally be recorded as

• A) a deduction from the investment account.
• B) dividend revenue.
• C) an addition to the investor's share of the investee's profit.
• D) a deduction from the investor's share of the investee's profit.

---

Definitions:

Dizygotic

Pertaining to twins that develop from two different eggs fertilized by two different sperms, also known as fraternal twins.

Pluripotent

In development, a cell or group of cells that have not yet become fixed or determined as to what specific tissues they are going to become.

Totipotent

Describes cells with the capability to differentiate into any type of cell in an organism, including the development of a complete organism.

Differentiated

A state or process in which cells or tissues undergo a change from a less specialized form to a more specialized form, often acquiring distinct structural or functional features.