Using the cost-adjusted-to-market method of accounting for a long-term investment in stock,the journal entry to record the receipt of dividends involves a debit to Dividend Income.

Question

Quizplus · Accepted Answer

In the cost-adjusted-to-market method, the receipt of dividends is recorded with a debit to Cash and a credit to Dividend Income, not a debit to Dividend Income.

Using the Cost-Adjusted-To-Market Method of Accounting for a Long-Term Investment