Fredo, Incorporated, purchased $10\%$ of Sonny Enterprises for $$1,000,000$ on January $1,2024.$ Sonny recognized a total of $$330,000$ net income during $2024,$ paid $$23,000$ of dividends to Fredo during $2024,$ and at December $31,2024,$ the market value of the Sonny investment increased to $$1,033,000.$

Required:

Prepare the journal entries necessary to account for the Sonny investment, assuming that Fredo $(1)$ does not have significant influence or $(2)$ does have significant influence over the operating and financial policies of the investee.