Gaines Corporation Invested $114,000 to Acquire 24,000 Shares of Owens $$\begin{array} { | c | r | r | } \hline \text { Cash } & 78,000 & \\\hline \text { Equity Investments } & & 78,000 \\\hline\end{array}$$

question 182

Multiple Choice

Gaines Corporation invested $114,000 to acquire 24,000 shares of Owens Technologies,Inc.on March 1,2018.On July 2,2019,Owens pays a cash dividend of $3.25 per share.The investment is classified as equity securities with no significant influence.Which of the following is the correct journal entry to record the transaction on July 2,2019?

• A) \[\begin{array} { | c | r | r | }
• \hline \text { Cash } & 78,000 & \\
• \hline \text { Equity Investments } & & 78,000 \\
• \hline
• \end{array}\]
• B) \[\begin{array} { | c | r | r | }
• \hline \text { Cash } & 78,000 & \\
• \hline \text { Retained Earnings } & & 78,000 \\
• \hline
• \end{array}\]
• C) \[\begin{array} { | c | r | r | }
• \hline \text { Equity Investments } & 78,000 & \\
• \hline \text { Cash } & & 78,000 \\
• \hline
• \end{array}\]
• D) \[\begin{array} { | c | r | r | }
• \hline \text { Cash } & 78,000 & \\
• \hline \text { Dividend Revenue } & & 78,000 \\
• \hline
• \end{array}\]

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