Second National Insurance Company provided this information for its minority-passive equity securities:

						Fair Value
Security	Date Acquired	Acquisition Cost				12/31/X1				12/31/X2
Company A Common	1/15/X1	$	50,000			$	60,000			$	55,000
Company B Common	6/30/X1		30,000				25,000				13,000	*
Company C Preferred	2/1/X2		20,000								25,000
Company D Common	5/1/X2		10,000								12,000

* Second National sold 50% of the Company B common shares for $14,000 on July 1, 20X2. Fair value at December 31, 20X2 is for the Company B shares remaining in the trading portfolio.

Required:

1. Provide the journal entries to record the fair value adjustment on December 31, 20X1. Assume that Second National uses an account entitled Fair value adjustmentminority-passive equity securities to adjust the cost of the portfolio to year-end fair values.
2. Provide the entry to record the sale of Company Bs common shares on July 1, 20X2. Assume that the last fair value adjustment for these shares was on December 31, 20X1.
3. Provide the journal entry and supporting calculations for the fair value adjustment on December 31, 20X2.

(If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)