Problem $1-16($Algo$)($LO $1-4,1-5,1-8)$

On January $1,2020,$ Alison, Inc., paid $$73,900$ for a $40$ percent interest in Holister Corporation's common stock. This investee had

assets with a book value of $$251,500$ and liabilities of $$122,500.$ A patent held by Holister having a $$8,100$ book value was actually

worth $$30,600.$ This patent had a six$-$year remaining life. Any further excess cost associated with this acquisition was attributed to

goodwill. During $2020,$ Holister earned income of $$49,500$ and declared and paid dividends of $$17,000.$ In $2021,$ it had income of

$$64,500$ and dividends of $$22,000.$ During $2021,$ the fair value of Allison's investment in Holister had risen from $$88,700$ to $$94,900.$

a$.$ Assuming Alison uses the equity method, what balance should appear in the Investment in Holister account as of December $31,$

$2021?$

b$.$ Assuming Alison uses fair$-$value accounting, what income from the investment in Holister should be reported for $2021?$