Awesome Accounting Students (AAS) Incorporated disclosed the following information in Footnote 9 of their most recent annual report.

	December 31, 2020
$ in millions	Adjusted Cost	Gross Unrealized Gains	Gross Unrealized Losses	Fair Value
Corporate debt investments	$4,500	$15	$16	$4,499
Investment in Governmental Debt	2,010		24	1,986
Financial institution Instruments	3,200	980	230	3,950
Total AFS Investments	$9,710	$995	$270	$10,435

	December 31, 2019
$ in millions	Adjusted Cost	Gross Unrealized Gains	Gross Unrealized Losses	Fair Value
Corporate debt investments	$4,800	$3	$10	$4,793
Investment in Governmental Debt	5,450		60	5,390
Financial institution Instruments	4,650	1,026	125	5,551
Total AFS Investments	$14,900	$1,029	$195	$15,734

AAS indicates the following: “During 2020, we sold available-for-sale investments. . . The gross realized gains on sales of available-for-sale investments were $970 million in 2020. AAS’s Note 17 (Other Comprehensive Income) indicates unrealized holding gains of $855 million during 2020, and a reclassification adjustment of $970 for gains that had previously been included in OCI and recorded in the fair value adjustment but which were now being included in net income after being realized upon sale.

Required:
1. Prepare a T-account that shows the change between the December 31, 2019, and December 31, 2020, balances for the fair value adjustment associated with AAS’s AFS Investments.   Also, indicate how much did the fair value adjustment change during 2020?

2. Prepare a journal entry that records any unrealized holding gains and losses that occurred during 2020. Ignore income taxes.

3. Prepare a journal entry that records any reclassification adjustment for available-for-sale investments sold during 2020. Ignore income taxes.

4. Using your journal entries from requirements 2 and 3, adjust your T-account from requirement 1. Have you accounted for the entire change in the fair value adjustment that occurred during 2020? If not, what is one possible explanation?