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Lacey Inc. reported these transactions relating to marketable trading investments intended to generate profits and to be sold in the near term:
-The entry to record the receipt of the dividends on December 1 would include a
A)credit to Dividend Revenue for $600.
B)credit to Trading Investments for $600.
C)credit to Dividend Revenue of $1,000.
D)credit to Realized Gain for $1,000.

Question

Use the following information to answer questions 
Lacey Inc. reported these transactions relating to marketable trading investments intended to generate profits and to be sold in the near term: 
-The entry to record the receipt of the dividends on December 1 would include a
A)credit to Dividend Revenue for $600. 
B)credit to Trading Investments for $600. 
C)credit to Dividend Revenue of $1,000. 
D)credit to Realized Gain for $1,000.

Quizplus · Accepted Answer

Dividend revenue is credited for the amount of dividends received. Trading investments and realized gain account are not affected by the receipt of dividends, so options B and D are incorrect. The amount of dividends received is only $600, not $1,000, so option C is also incorrect.

Use the Following Information to Answer Questions