[The following information applies to the questions displayed below.] Mead Incorporated began operations in Year 1. Following is a series of transactions and events involving its long-term debt investments in available-for-sale securities. Year 1 January 20 Purchased Johnson & Johnson bonds for $26,500. February 9 Purchased Sony notes for $60,840. June 12 Purchased Mattel bonds for $46,500. December 31 Fair values for debt in the portfolio are Johnson & Johnson, $30,700; Sony, $49,950; and Mattel, $55,250. Year 2 April 15 July 5 Sold all of the Johnson & Johnson bonds for $29,500. Sold all of the Mattel bonds for $40,050. July 22 Purchased Sara Lee notes for $16,300. August 19 Purchased Kodak bonds for $19,500. December 31 Fair values for debt in the portfolio are Kodak, $19,425; Sara Lee, $18,000; and Sony, $63,000. Year 3 February 27 Purchased Microsoft bonds for $159,400. June 21 Sold all of the Sony notes for $62,400. June 30 Purchased Black & Decker bonds for $56,400. August 3 Sold all of the Sara Lee notes for $15,150. November 1 Sold all of the Kodak bonds for $24,375. December 31 Fair values for debt in the portfolio are Black & Decker, $58,200; and Microsoft, $159,800. Che