Question

Situation 1
Bridgeport Cosmetics acquired 10% of the 207,000 shares of common stock of Martinez Fashion at a total cost of $14 per share on March 18, 2020. On June 30, Martinez declared and paid $70,100 cash dividend to all stockholders. On December 31, Martinez reported net income of $112,700 for the year. At December 31, the market price of Martinez Fashion was $15 per share.

Situation 2
Indigo, Inc. obtained significant influence over Seles Corporation by buying 40% of Seles’s 30,800 outstanding shares of common stock at a total cost of $9 per share on January 1, 2020. On June 15, Seles declared and paid cash dividends of $33,000 to all stockholders. On December 31, Seles reported a net income of $86,300 for the year.

Prepare all necessary journal entries in 2020 for both situations. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.)

Date	Account Titles and Explanation	Debit	Credit
Situation 1: Bridgeport Cosmetics
choose a transaction date Jan. 1, 2020Mar. 18, 2020June 15, 2020June 30, 2020Dec. 31, 2020	enter an account title	enter a debit amount	enter a credit amount
	enter an account title	enter a debit amount	enter a credit amount
choose a transaction date Jan. 1, 2020Mar. 18, 2020June 15, 2020June 30, 2020Dec. 31, 2020	enter an account title	enter a debit amount	enter a credit amount
	enter an account title	enter a debit amount	enter a credit amount
choose a transaction date Jan. 1, 2020Mar. 18, 2020June 15, 2020June 30, 2020Dec. 31, 2020	enter an account title	enter a debit amount	enter a credit amount
	enter an account title	enter a debit amount	enter a credit amount
Situation 2: Indigo, Inc
choose a transaction date Jan. 1, 2020Mar. 18, 2020June 15, 2020June 30, 2020Dec. 31, 2020	enter an account title	enter a debit amount	enter a credit amount
	enter an account title	enter a debit amount	enter a credit amount
choose a transaction date Jan. 1, 2020Mar. 18, 2020June 15, 2020June 30, 2020Dec. 31, 2020	enter an account title	enter a debit amount	enter a credit amount
	enter an account title	enter a debit amount	enter a credit amount
choose a transaction date Jan. 1, 2020Mar. 18, 2020June 15, 2020June 30, 2020Dec. 31, 2020	enter an account title	enter a debit amount	enter a credit amount
	enter an account title	enter a debit amount	enter a credit amount

Answer 1

credit $289800 $7010 1$ 20,700 Answer: Situationi: Bridge port Cometics Date particulary Debit Mar 18 Available for sale securities Aledr $289,800 2020 (207,000 X10% * $ 14) ... to cash Being to record acquisition of shares in Martinez Fashion os investment) June 3d cash . Ale dr $7010 2020 to Dividend (70,100 X 10%) 1. Being to record dividend income) Dec 31 fair value adjustment Ale dr $20,700 2020 to unrealized holding gair or loss income (207,000 X 10%)x($15-$14) Being to record Rour value adjustment as in difference in market place and purchase price) . Situation & Indigo ine Bate | particulary Debit Jani Investment in saly corporabion Ale ar $110,880 loco (30,800 x 40% $9) I To cash Being to record muestment made by Purchase of fuary in saly Corporation) June 15 cash (33000x40%) Ale dr $13200 2020 to Investment in sales corporation Being to recold dividend Encore received ! from investment) Decal anvestment in saly Corporation Aledr $34520 I 2020 (86,300 X40%) To Revenue (Being to record sware in net income Treported by saley Corporation) kredit $ 110,880 $ 13,200 34520