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Presented below is information related to the purchases of common stock by Splish Company during...

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Accounting

Presented below is information related to the purchases of common stock by Splish Company during 2017. Cost (at purchase date) Fair Value (at December 31) Investment in Arroyo Company stock $102,000 $81,000 Investment in Lee Corporation stock 238,000 286,000 Investment in Woods Inc. stock 169,000 179,000 Total $509,000 $546,000 (Assume a zero balance for any Fair Value Adjustment account.)

(a) What entry would Splish make at December 31, 2017, to record the investment in Arroyo Company stock if it chooses to report this security using the fair value option?

(b) What entry would Splish make at December 31, 2017, to record the investments in the Lee and Woods corporations, assuming that Splish did not select the fair value option for these investments?

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