Under the Equity Method of Accounting for Investments in Common

question 24

Multiple Choice

Under the equity method of accounting for investments in common stock, when a dividend is received from the investee company

• A) the Dividend Revenue account is credited.
• B) the Stock Investments account is increased.
• C) the Stock Investments account is decreased.
• D) no entry is necessary.

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Definitions:

Liverworts

A group of non-vascular plants belonging to the plant division Marchantiophyta, often found in moist, shaded environments.

Lycopodiophyta

A division of plants, commonly known as clubmosses, characterized by a primitive vascular system, often found in moist, shaded environments.

Hepaticophyta

A division of non-vascular plants commonly known as liverworts, which are simple plants that form flat green thalli.

Anthocerophyta

A division of non-vascular plants known as hornworts, characterized by a horn-like structure that contains the plant's reproductive organs.