Why does the equity method record dividends received from an investee as a reduction in the investment account, not as dividend income?

As per the equity method, the investor do not treat dividend as revenue rather they record the receipt of dividend as a carrying value of investment.

Explanation:

As per the equity method, the investor do not treat dividend as revenue rather they record the receipt of dividend as a carrying value of investment. An investor´s account decrease as a dividend is collected, because distribution of cash dividend reduce the carrying amount of investee company.

The double entry for this transaction would be:

Dividend received Dr

Carrying amount of investmentCr

A parallel is established between investment account and the underlying activities of the investee.

the correct answer option is b. a single paragraph.

explanation:

when you are thinking about paragraph​ topics, you should always choose a subject that can be adequately addressed in a single paragraph.

a paragraph is a piece of writing consisting of a few sentences that deal with a single theme. it has only a single idea that the paragraph revolves around and talks about.

so a paragraph topic must be chosen wisely where a single idea can be communicated in a single paragraph.