Exercise 17-12

The following are two independent situations.

Situation 1

Concord Cosmetics acquired 10% of the187,000shares of common stock of Martinez Fashion at a total cost of $13per share on March 18, 2017. On June 30, Martinez declared and paid $68,400cash dividend to all stockholders. On December 31, Martinez reported net income of $120,300for the year. At December 31, the market price of Martinez Fashion was $14per share.

Situation 2

Marigold, Inc. obtained significant influence over Seles Corporation by buying30% of Seles's30,200outstanding shares of common stock at a total cost of $9per share on January 1, 2017. On June 15, Seles declared and paid cash dividends of $37,500. On December 31, Seles reported a net income of $77,600for the year.

Prepare 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: ConcordCosmetics

Situation 2: Marigold, Inc

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