The following are two independent situations. Situation 1 Metlock Cosmetics acquired 10% of the 187,000 shares of common stock of Martinez Fashion
The following are two independent situations.
Situation 1
Metlock Cosmetics acquired 10% of the 187,000 shares of common stock of Martinez Fashion at a total cost of $13 per share on March 18, 2020. On June 30, Martinez declared and paid $68,400 cash dividend to all stockholders. On December 31, Martinez reported net income of $117,600 for the year. At December 31, the market price of Martinez Fashion was $14 per share.
Situation 2
Bonita, Inc. obtained significant influence over Seles Corporation by buying 40% of Seles’s 27,000 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 $39,200 to all stockholders. On December 31, Seles reported a net income of $84,700 for the year.
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