Presented below are two independent situations.
1. Heath Cosmetics acquired 15% of the 200,000 ordinary shares of Van Fashion at a total cost of $13 per share on March 18, 2011. On June 30, Van declared and paid a $60,000 dividend. On December 31, Van reported net income of $122,000 for the year. Al December 31, the market price of Van Fashion was $15 per share. The shares are classified as available- for-sale.
2. Yoder Co. obtained significant influence over Parks by buying 30% of Parks 30,000 ordinary shares at a total cost of $9 per share on January 1, 2011. On June 15, Parks declared and paid a cash dividend of $30,000. On December 31, Parks reported a net income of $80,000 for the year.

Prepare all the necessary journal entries for 2011 for
(1) Heath Cosmetics
(2) Yoder Co.

  • CreatedMarch 11, 2013
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