Acme Company owns 35% of Superior Company. Superior Company declared and paid $44,000cash dividends for the year. Acme Company's journal entry to record the dividends includes a:Ocredit to the Investment account for $44.000.credit to Dividend Revenue for $15.400.credit to the Investment account for $15,400.credit to Dividend Revenue for $44,000.None of the above.C

If the investment is more than 20%, it is considered to be a significant share invested in the company. So dividends are credited to the investment account instead of dividend account.Answer: credit to the Investment account for $15,400 Journal entry: Accounts Debit Credit Cash ($44,000 x 35%) 15,400 Investment account 15,400 Dividend revenue is credited in case of investment is less than 20%.

Business

Accounting

Acme Company owns 35% of Superior Company. Superior Company declared and paid $44.000 cash dividends for the year. Acme Company's journal entry to record the dividends includes a: credit to the Investment account for $44.000. credit to Dividend Revenue for $15,400. Ocredit to the Investment account for $15,400. credit to Dividend Revenue for $44,000. None of the above.

Acme Company owns 35% of Superior Company. Superior Company declared and paid $44.000 cash dividends for the year. Acme Company's journal entry to record the dividends includes a: credit to the Investment account for $44.000. credit to Dividend Revenue for $15,400. Ocredit to the Investment account for $15,400. credit to Dividend Revenue for $44,000. None of the above.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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