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When Applying the Rules of the Equity Method,the Equity Investments

Question 139

Multiple Choice

When applying the rules of the equity method,the Equity Investments account is credited for the receipt of a cash dividend because ________.


A) the dividend decreases the investor's investment
B) the dividend is treated as earnings rather than a return of capital
C) there is a decrease in the dividend liability
D) the dividend increases the total assets

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