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When an investor does not exert influence over the investee and accounts for an equity investment at fair value, cash dividends received by the investor from the investee should normally be recorded as:___________.
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When an investor does not exert influence over the investee and accounts for an equity investment at fair value, cash dividends received by the investor from the investee should normally be recorded as:___________.

User Rahul Sagore
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1 Answer

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Answer:

a) Dividend income.

Step-by-step explanation:

If the investor company doesn't have enough stocks to really influence how the investee company acts, they should record their investment at fair market market (= market price of the stocks). Any dividends received must be recorded as dividend income, and the investor company should use the dividends received deductions to lower its taxes.

User Joelazar
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