Lawrence Inc. acquired 20% of the outstanding common shares of Cherokee Inc. on December 31, 2019. The purchase price was $1,250,000 for 50,000 shares, and is equal to 20% of Cherokee's carrying amount. Cherokee declared and paid an $0.80 per share cash dividend on June 30 and again on December 31, 2020. Cherokee reported net income of $730,000 for 2020. The fair value of Cherokee's shares was $27 per share at December 31, 2020.

Instructions

Prepare the journal entries for Lawrence for 2019 and 2020, assuming that Lawrence follows IFRS and can exercise significant influence over Cherokee.

DATE	ACCOUNTS	DEBIT	CREDIT