diff --git a/mysql-test/suite/binlog/r/binlog_innodb_row.result b/mysql-test/suite/binlog/r/binlog_innodb_row.result
index 093628c29cc..61f961f16da 100644
--- a/mysql-test/suite/binlog/r/binlog_innodb_row.result
+++ b/mysql-test/suite/binlog/r/binlog_innodb_row.result
@@ -59,3 +59,20 @@ show binlog events from <binlog_start>;
 Log_name	Pos	Event_type	Server_id	End_log_pos	Info
 master-bin.000001	#	Query	#	#	use `test`; DROP TEMPORARY TABLE IF EXISTS `t1` /* generated by server */
 ###############################################
+#
+# Bug#12346411 SQL/LOG.CC:6509: ASSERTION `PREPARED_XIDS > 0' FAILED
+#
+DROP TABLE IF EXISTS t1, t2;
+CREATE TABLE t1(a INT PRIMARY KEY) engine=innodb;
+CREATE TABLE t2(a INT) engine=myisam;
+INSERT INTO t1 VALUES (1);
+START TRANSACTION;
+INSERT INTO t2 VALUES (1);
+INSERT IGNORE INTO t1 VALUES (1);
+COMMIT;
+INSERT INTO t1 VALUES (2);
+START TRANSACTION;
+INSERT INTO t2 VALUES (2);
+UPDATE IGNORE t1 SET a=1 WHERE a=2;
+COMMIT;
+DROP TABLE t1, t2;
diff --git a/mysql-test/suite/binlog/t/binlog_innodb_row.test b/mysql-test/suite/binlog/t/binlog_innodb_row.test
index b491510c9c9..f4ad1058a7e 100644
--- a/mysql-test/suite/binlog/t/binlog_innodb_row.test
+++ b/mysql-test/suite/binlog/t/binlog_innodb_row.test
@@ -77,3 +77,29 @@ DROP TEMPORARY TABLE t1;
 -- echo ###############################################
 -- source include/show_binlog_events.inc
 -- echo ###############################################
+
+
+--echo #
+--echo # Bug#12346411 SQL/LOG.CC:6509: ASSERTION `PREPARED_XIDS > 0' FAILED
+--echo #
+
+--disable_warnings
+DROP TABLE IF EXISTS t1, t2;
+--enable_warnings
+
+CREATE TABLE t1(a INT PRIMARY KEY) engine=innodb;
+CREATE TABLE t2(a INT) engine=myisam;
+
+INSERT INTO t1 VALUES (1);
+START TRANSACTION;
+INSERT INTO t2 VALUES (1);
+INSERT IGNORE INTO t1 VALUES (1);
+COMMIT;
+
+INSERT INTO t1 VALUES (2);
+START TRANSACTION;
+INSERT INTO t2 VALUES (2);
+UPDATE IGNORE t1 SET a=1 WHERE a=2;
+COMMIT;
+
+DROP TABLE t1, t2;
diff --git a/sql/log.cc b/sql/log.cc
index bb5b37baa69..ce6b0f0a5a2 100644
--- a/sql/log.cc
+++ b/sql/log.cc
@@ -6506,8 +6506,11 @@ int TC_LOG_BINLOG::unlog(ulong cookie, my_xid xid)
 {
   DBUG_ENTER("TC_LOG_BINLOG::unlog");
   mysql_mutex_lock(&LOCK_prep_xids);
-  DBUG_ASSERT(prepared_xids > 0);
-  if (--prepared_xids == 0) {
+  // prepared_xids can be 0 if the transaction had ignorable errors.
+  DBUG_ASSERT(prepared_xids >= 0);
+  if (prepared_xids > 0)
+    prepared_xids--;
+  if (prepared_xids == 0) {
     DBUG_PRINT("info", ("prepared_xids=%lu", prepared_xids));
     mysql_cond_signal(&COND_prep_xids);
   }