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On Oct. $1,2021,$ the beginning of the $4$th quarter, Sooner Co$.$ held $$60$ million of $10\%$ bonds of Castor Corp., purchased on May

$1,2021$ at face value and held as trading securities$.$ The company's fiscal year ends on December $31.$

Listed below are transactions during the fourth quarter of $2021$ relating to the company's investments.

Date Transaction

Oct. $18$ Purchased $2$ million shares of Melton Corp. common stock for $$63$ million. The purchase does not give Sooner

significant influence as Melton has a total of $68$ million shares issued.

Oct. $31$ Received semiannual interest of $$3\mathrm{.}0$ million from the Castor Corp. bonds.

Nov. $1$ Purchased $10\%$ bonds of Hughes Corp. at their $$120$ million face value, to be held until they mature in $2031.$

Semiannual interest is payable April $30$ and October $31.$

Nov. $1$ Sold the Castor Corp. bonds for $$53$ million. No unrealized gains and losses had been recorded on these bonds

previously.

Dec. $1$ Purchased $12\%$ bonds of Phillips Corp. at their $$40$ million face value as available$-$for$-$sale securities$.$ The bonds

mature in $2031.$ Semiannual interest is payable May $31$ and November $30.$

Dec. $20$ Purchased U$.$S$.$ Treasury bonds for $$7\mathrm{.}5$ million as trading securities$,$ hoping to earn profits on short$-$term differences

in prices.

Dec. $21$ Purchased $4$ million shares of Nelson Corp.$\text{'}$s $54$ million shares of common stock for $$54$ million, planning to hold

these shares indefinitely.

Dec. $23$ Sold the Treasury bonds for $$8\mathrm{.}1$ million.

Dec. $29$ Received cash dividends of $$9$ million from the Melton Corp. shares of common stock.

Additionally, on December $31,2021,$ the company recorded any necessary adjusting entries relating to changes in fair values of

the investments. Specifically, as of December $31$:

The fair value of the Hughes Corp. bond investment was $$18\mathrm{.}6$ million

The fair value of the Phillips Corp. bond investment was $$37\mathrm{.}0$ million

The market price of the Melton Corp. common stock was $$28\mathrm{.}50$ per share

The market price of the Nelson Corp. common stock was $$18\mathrm{.}50$ per share

Required:

Review the list of transactions above. Then, select the appropriate classification and accounting treatment for each

investment listed in the table below.

Record each transaction or year$-$end adjusting entry, using "Investment in bonds" or Investment in equity securities$"$ as the

name of the investment accounts. If no entry is required for a transaction$/$event$,$ select $"$No journal entry required" in

the first account field. Do not round intermediate calculations. Enter answers in millions rounded to $1$ decimal place,

$($i$.$e$.,5,500,000$ should be entered as $5\mathrm{.}5).$ Entries $12-17$ are adjusting entries, if necessary, recorded on Dec. $31,2021.$

Determine the amounts reported on Sooner's $2021$ financial statements: a$)$ BALANCE SHEET: the amounts reported as

assets on the balance sheet for investments in equity securities $($and Fair Value Adjustment for all equity securiites$)$ and

investments in debt securities $($and Fair Value Adjustment for all debt securities$)$ and b$)$ INCOME STATEMENT; the

amounts related to investments $($show all gains$/$losses$,$ realized and unrealized, as a single amount called "Net gain $($or loss$)$

on investments. $($Amounts to be deducted should be indicated with a minus sign. Enter your answers in millions

rounded to $1$ decimal place, $($i$.$e$.,5,500,000$ should be entered as $5\mathrm{.}5).)$

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