Use the following information below to answer questions $1$ and $2.$

On January $2,2024,$ Rainbow, Inc. purchased $18\%$ of Skittles Corporation's common sto for $$120,000.$ At the time of the investment, the book value and fair value of Skittles' net assets were equal except for a tract of land which had appreciated by $$75,000.$

The following additional information was obtained from the financial statements for Skittles:

Net income$-$year ended December $31,2024$$$30,000$

Net income$-$year ended December $31,2025$$$70,000$

Dividends paid to common shareholders in $2024.$ $ $0$

Dividends paid to common shareholders in $2025,$$$60,000$

On December $31,2024,$ the fair value of Rainbow's investment in the common stock of Skities was $$115,000,$ and on December $31,2025,$ its fair value was $$140,000.$

Assume Rainbow does not have significant influence over Skittles. How much would Rainbow report in its $2025$ income statement related to this investment?

A$.$ $$60,000$

B$.$ $$35,800$

C$.$ $$30,800$

D$.$ $$12,600$

E$.$ $$1,800$

Assume Rainbow does have significant influence over Skittles. How much would Rainbow report as its investment in Skittles on its $12/31/2025$ balance sheet?

A$.$ $$120,000$

B$.$ $$121,800$

C$.$ $$127,200$

D$.$ $$138,000$

E$.$ $$140,000$