Using the information in Self-Test Question 6, what entry would Horicon make to record the receipt of the dividend from Sheboygan?

Data from Self-Test Question 6

Assume that Horicon Corp acquired 25% of the common stock of Sheboygan Corp. on January 1, 2014, for $300,000. During 2014 Sheboygan Corp. reported net income of $160,000 and paid total dividends of $60,000.

If Horicon uses the equity method to account for its investment, the balance in the investment account on December 31, 2014, will be:

(a) Debit Cash and credit Revenue from Stock Investments.

(b) Debit Cash Dividends and credit Revenue from Stock Investments.

(c) Debit Cash and credit Stock Investments.

(d) Debit Cash and credit Dividend Revenue.