On January 5, 2012, Gannon Corporation purchased 100 shares of Hedney Company stock at $12 per share and paid a $50 brokerage commission. Gannon classified the shares as available-for-sale securities. On May 31, 2012, the entry to record the receipt of the 60-cent-per-share dividend would include a credit to

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Since Gannon classified the shares as available-for-sale securities, the dividend income should be recognized as a credit to Dividend Revenue. The dividend amount is based on the number of shares owned, which is 100 shares x $0.60 per share = $60. Therefore, the entry to record the receipt of the dividend would include a credit to Dividend Revenue for $60. The Long-Term Investments account is not affected by the receipt of the dividend, as it only reflects the initial cost of the investment.

On January 5, 2012, Gannon Corporation Purchased 100 Shares of Hedney