Dividends Received for Equity Securities in Which the Investor Lacks

question 186

True/False

Dividends received for equity securities in which the investor lacks the ability to participate in the decisions of the investee company are recorded with a debit to the Dividend Revenue account.

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Definitions:

Good Faith

A principle denoting honesty and sincerity of intention without any intent to deceive or defraud.

Fiduciary Duty

This is a legal obligation of one party to act in the best interest of another when entrusted with care of money, property, or confidential information.

Madoff's Ponzi Scheme

A massive fraudulent investment operation masterminded by Bernard Madoff, where returns to investors were paid from their own money or the money of new investors, rather than from profit earned.

Proper Name

A specific reference to a unique individual, place, or thing, typically starting with a capital letter and used to give identity.