Homework Answers
| transaction | general journal | debit | credit |
| 1 | investment account | $31000 | |
| investment income | $31000 |
the investment revenue amount recieved from costruction corporation=$155000*20%=$31000
only 20% of net income is attributale to MBH inc.
investment account is an asset account and it should be debited when it increases and investment income is a revenue account which should be credited when it increases.
| transaction | general journal | debit | credit |
| 2 | cash | $16000 | |
| investment account | $16000 |
the dividend amount recieved from construction corporation=$80000*20%=$16000
only 20% of dividend paid is attributale to MBH inc.
cash is an asset account and it should be debited when it increases and investment account is an asset account,but the dividend recieved will reduce your investment's value.therefore it should be cedited.
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