Equity method, Income Statement question

From Kaplan:

So we don’t subtract the dividends received when calculating the income statement amount under the given scenario?

Dividends are considered a return of capital, not a return on capital.

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Good grief, I may as well go back to the 6th grade. This module is making me myopic.

If you do, play basketball or volleyball.

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And when using the Acquisition method, the subsidiary’s Assets and Liabilities are reported at Fair Value, correct?