Regarding the receipt of a stock dividend from an investment that is held as a long-term investment in available-for-sale security, which of the following statements is CORRECT?
A) Dividend revenue, based on the current fair value of the stock, is recorded.
B) Because the number of shares of stock held has increased, the investor's cost per share also increases.
C) A new cost per share is determined and that amount is used for all future transactions affecting the investment.
D) The accounting treatment for a stock dividend is the same as the accounting treatment for a cash dividend.
Correct Answer:
Verified
Q62: The gain or loss on the sale
Q63: Which is the most reliable method for
Q64: The Allowance to Adjust Investment in Available-for-Sale
Q65: Following U.S. Generally Accepted Accounting Principles, the
Q66: How does the receipt of a stock
Q68: Other comprehensive income:
A)is a separate section of
Q69: U.S. Generally Accepted Accounting Principles require that
Q70: On January 1, 2017, Imagine Corporation purchases
Q71: Seider Company receives a stock dividend of
Q72: An investor receives a cash dividend from
Unlock this Answer For Free Now!
View this answer and more for free by performing one of the following actions
Scan the QR code to install the App and get 2 free unlocks
Unlock quizzes for free by uploading documents