These are two independent situations: 1. Angel Cosmetics acquired 12% of the 300,000 shares of common stock of Chic Fashion at a total cost of $14 per share on March 18, 2012. On June 30, Chic declared and paid a

These are two independent situations:
1. Angel Cosmetics acquired 12% of the 300,000 shares of of Chic Fashion at a total cost of $14 per share on March 18, 2012. On June 30, Chic declared and paid a $75,000 On December 31, Chic reported net income of $244,000 for the year. At December 31, the market price of Chic Fashion was $16 per share.
The stock is classified as available-for-sale.
2. Randell Inc. obtained significant influence over Gatos by buying 25% of Gatos’s 30,000 outstanding shares of at a total cost of $11 per share on January 1, 2012. On June 15, Gatos declared and paid a cash of $35,000. On December 31, Gatos reported a net income of $120,000 for the year. Instructions
Prepare all the necessary journal entries for 2012 for
(a) Angel Cosmetics and
(b) Randell Inc.

Common Stock
Common stock is an equity component that represents the worth of stock owned by the shareholders of the company. The common stock represents the par value of the shares outstanding at a balance sheet date. Public companies can trade their stocks on... Corporation
A Corporation is a legal form of business that is separate from its owner. In other words, a corporation is a business or organization formed by a group of people, and its right and liabilities separate from those of the individuals involved. It may... Dividend
A dividend is a distribution of a portion of company’s earnings, decided and managed by the company’s board of directors, and paid to the shareholders. Dividends are given on the shares. It is a token reward paid to the shareholders for their...