Dividends Received on Investments Are Accounted for in the Same

question 173

True/False

Dividends received on investments are accounted for in the same way under the cost and the equity method.

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Definitions:

Debits

Entries that are recorded on the left side of accounting ledgers and journals, representing increases in assets or expenses or decreases in liabilities, equity, and income.

Assets

Resources owned by a company or individual that have economic value and can provide future benefits.

Liabilities

Liabilities refer to financial obligations or debts that a company owes, which are expected to be settled through the transfer of assets, provision of services, or other economic benefits.

Account

A record summarizing all the transactions pertaining to a single item in the accounting equation.