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Question
What will be the accounting treatment of a dividend received in the books of accounts?
Options
Asset side of Balance Sheet
Liability side of Balance Sheet
Debit side of Profit and Loss account
Credit side of Profit and Loss account
MCQ
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Solution
Credit side of Profit and Loss account
Explanation:
Dividend received is non‑trading income that increases profit; therefore, it is recorded as income (credit) in the Profit & Loss account, not as an asset or liability.
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