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Presented below are two independent situations. Situation 1 Hatcher Cosmetics acquired 10% of the 207,700 shares of common stock of Ramirez Fashion at a total
Presented below are two independent situations. Situation 1 Hatcher Cosmetics acquired 10% of the 207,700 shares of common stock of Ramirez Fashion at a total cost of $15 per share on March 18, 2012. On June 30, Ramirez declared and paid a $82,200 cash dividend. On December 31, Ramirez reported net income of $128,500 for the year. At December 31, the market price of Ramirez Fashion was $17 per share. The securities are classified as available-for-sale. Situation 2 Holmes, Inc. obtained significant influence over Nadal Corporation by buying 27% of Nadal
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