Forest Ltd

Forest Ltd. accounts for its investment in Leeds Co. using the cost method. During the year, Forest received $10,000 in dividends from Leeds. How should Forest report these dividends on its separate-entity financial statements?

A) As an increase to the "Investment in Leeds Co." account on its statement of financial position
B) As a decrease to the "Investment in Leeds Co." account on its statement of financial position
C) As dividend income on its statement of changes in equity-retained earnings section
D) As dividend income in its statement of comprehensive income

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