Question: These are two independent situations 1 Eusey Cosmetics acquired 12

These are two independent situations:
1. Eusey Cosmetics acquired 12% of the 300,000 shares of common stock of High Fashion at a total cost of $14 per share on March 18, 2014. On June 30, High declared and paid a $75,000 dividend. On December 31, High reported net income of $244,000 for the year. At December 31, the market price of High Fashion was $16 per share. The stock is classified as available-for-sale.
2. Dickson Inc. obtained significant influence over Kiner Corporation by buying 25% of
Kiner’s 30,000 outstanding shares of common stock at a total cost of $11 per share on
January 1, 2014. On June 15, Kiner declared and paid a cash dividend of $35,000. On
December 31, Kiner reported a net income of $120,000 for the year.
Prepare all the necessary journal entries for 2014 for (a) Eusey Cosmetics and (b) Dickson Inc.

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  • CreatedApril 07, 2014
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