Regular cash dividends received by an investor with long-term stock investments are recorded as what under the fair value method?

Under the fair value method, regular cash dividends received from long-term stock investments are recorded as income. This reflects the nature of cash dividends as a return on investment, which contributes to the investor's overall income statement for the period. When an investor holds equity investments, any dividends received are recognized and recorded as revenue, enhancing the investor's earnings for that accounting period.

The other options don't accurately represent the treatment of dividends under the fair value method. Dividends are recognized as income rather than affecting the investment account directly or not being recorded at all. Thus, classifying the cash dividends as "neither" have an impact properly denotes that these incomes are indeed recorded as earnings rather than adjustments to the carrying value of the investment.