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If the Cost Method Is Used to Account for an Investment

question 106

True/False

If the cost method is used to account for an investment in stock, the Stock Investments account is increased by the amount of dividends received during the period.


Definitions:

Alternating Current

Electrical current that periodically reverses direction, in contrast to direct current that flows in only one direction.

Omnidirectional

Characteristic of an antenna that can send or receive signals equally well in all directions.

Unidirectional

Moving or operating in a single direction, often used to describe devices that allow current to flow only one way, like diodes.

Bidirectional

Capable of moving or functioning in two opposite directions.

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