Prepare all necessary journal entries in 2017 for both situations

Prepare all necessary journal entries in 2017 for both situations

Subject: Business    / Accounting
Question

Situation 1

Headland Cosmetics acquired 10% of the 182,000 shares of common stock of Martinez Fashion at a total cost of $12 per share on March 18, 2017. On June 30, Martinez declared and paid $76,700 cash dividend to all stockholders. On December 31, Martinez reported net income of $113,500 for the year. At December 31, the market price of Martinez Fashion was $13 per share.

Situation 2

Sage, Inc. obtained significant influence over Seles Corporation by buying 30% of Seles’s 28,900 outstanding shares of common stock at a total cost of $9 per share on January 1, 2017. On June 15, Seles declared and paid cash dividends of $35,400. On December 31, Seles reported a net income of $92,300 for the year.

Prepare all necessary journal entries in 2017 for both situations.(Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select “No Entry” for the account titles and enter 0 for the amounts.)

Date    Account Titles and Explanation    Debit    Credit
Situation 1: Headland Cosmetics
Jan. 1, 2017Mar. 18, 2017June 15, 2017June 30, 2017Dec. 31, 2017

Jan. 1, 2017Mar. 18, 2017June 15, 2017June 30, 2017Dec. 31, 2017

Jan. 1, 2017Mar. 18, 2017June 15, 2017June 30, 2017Dec. 31, 2017

Situation 2: Sage, Inc
Jan. 1, 2017Mar. 18, 2017June 15, 2017June 30, 2017Dec. 31, 2017

Jan. 1, 2017Mar. 18, 2017June 15, 2017June 30, 2017Dec. 31, 2017

Jan. 1, 2017Mar. 18, 2017June 15, 2017June 30, 2017Dec. 31, 2017