On November 1 of Year 1, Drucker Co. acquired the following investments in equity securities measured at FV-NI. Kelly Corporation 1,250 shares of common stock (no-par) at $60 per share Keefe Corporation 750 shares preferred stock ($10 par) at $20 per share On December 31, the company's year-end, the quoted market prices were as follows: Kelly Corporation common stock, $52, and Keefe Corporation preferred stock, $24. Following are the data for the following year (Year 2). Mar. 02: Dividends per share, declared and paid: Kelly Corp., $1, and Keefe Corp., $0.50. Oct. 01: Sold 250 shares of Keefe Corporation preferred stock at $25 per share. Dec. 31: Fair values: Kelly common, $46 per share, Keefe preferred, $26 per share. a. Prepare the entry for Drucker Company to record the purchase of the securities. b. Prepare any adjusting entry needed at December 31, Year 1. Note: If a journal entry isn't required for the transaction, select "N/A-Debit" and "N/A-Credit" as the account names and leave the Dr. and Cr. answers blank (zero). Date Account Name Nov. 1, Year 1 To record purchase of securities. Dec. 31, Year 1 To record adjusting entry. Debit Credit 0 0 0 0 0 0 0 0 c. Indicate the items and amounts that should be reported on the Year 1 income statement of Drucker and its year-end balance sheet. Assume that the investments are classified as current. Note: Use a negative sign to indicate a loss. Income Statement Year 1 Other Revenues and Gains Net gain (loss) on equity securities $ 0 Balance Sheet, Dec. 31, Year 1 Assets Investment in equity securities $ 0 d. Prepare the entries required in Year 2 to record dividend revenue, the sale of stock, and the fair value adjustment. Assume that the Fair Value Adjustment account needs to be adjusted for the investment portfolio on December 31, Year 2. Date Mar. 2, Year 2 Account Name Dr. 0 0 0 0 To record dividends received. Oct. 1, Year 2 0 0 0 0 0 0 To record sale of investment. Dec. 31, Year 2 0 0 0 0 To adjust the FVA account. e. Indicate items and amounts that should be reported on the Year 2 income statement and year-end balance sheet. Note: Use a negative sign to indicate a loss. Income Statement Other Revenues and Gains Dividend revenue Year 2 Net gain (loss) on equity securities Balance Sheet, Dec. 31, Year 2 Assets 0 0 Investment in equity securities 0 Cash Interest Receivable Investment in TS Fair Value Adjustment-TS Investment in AFS Securities Fair Value Adjustment-AFS Investment in HTM Securities Investment in Stock Fair Value Adjustment--Equity Securities Fair Value Adjustment-Fair Value Option Allowance for Credit Losses Accumulated Other Comprehensive Income Unrealized Gain or LossOCI Unrealized Gain or Loss-Income Dividend Revenue Interest Revenue Investment Income Loss on Impairment Recovery of Loss on Impairment Loss on Sale of Investment