If the equity method is being used, cash dividends received
A) are credited to the Dividend Revenue account.
B) do not require an entry because the investee's net income have already been recorded at the proper proportion on the investor's books.
C) are credited to the Investment in Associates account.
D) are credited to the Income from Associates account.

Question

Quizplus · Accepted Answer

Under the equity method, cash dividends received are credited to the Investment in Associates account because they reduce the carrying amount of the investment.

If the Equity Method Is Being Used, Cash Dividends Received