1. FF&T Corporation is a confectionery wholesaler that frequently buys and sells securities to meet various investment objectives. The following selected transactions relate to FF&€™s investment activities during the last two months of 2013. At November 1, FF&T held $48 million of 20-year, 10% bonds of Convenience, Inc., purchased May 1, 2013, at face value. Management has the positive intent and ability to hold the bonds until maturity. FF&T€™s fiscal year ends on December 31.  
Nov. 1 Received semiannual interest of $2.4 million from the Convenience, Inc., bonds.
Dec. 1 Purchased 12% bonds of Facsimile Enterprises at their $30 million face value, to be held until they mature in 2026. Semiannual interest is payable May 31 and November 30.
31 Purchased U.S. Treasury bills that mature in two months for $8.9 million.
31 Recorded any necessary adjusting entry(s) relating to the investments.  
The fair values of the investments at December 31 were:  
Convenience bonds .......$44.7 million
Facsimile Enterprises bonds .... 30.9 million
U.S. Treasury bills ...............................8.9 million

Required
Prepare the appropriate journal entry for each transaction or event. (If no entry is required for a particular transaction, select "No journal entry required" in the first account field. Enter your answers in millions rounded to 1 decimal place.
a. Received semiannual interest of $2.4 million from the Convenience, Inc., bonds.
b. Purchased 12% bonds of Facsimile Enterprises at their $30 million face value, to be held until they mature in 2026. Semiannual interest is payable May 31 and November 30.
c. Purchased U.S. Treasury bills that mature in two months for $8.9 million.
d. Recorded any necessary adjusting entry(s) relating to the investments.

2. On January 2, 2013, Sanborn Tobacco Inc. bought 5% of Jackson Industry€™s capital stock for $90 million as a temporary investment. Sanborn classified the securities acquired as available-for-sale. Jackson Industry€™s net income for the year ended December 31, 2013, was $120 million. The fair value of the shares held by San born was $98 million at December 31, 2013. During 2013, Jackson declared a dividend of $60 million.
a. Prepare all appropriate journal entries related to the investment during 2013. (If no entry is required for a particular event, select "No journal entry required" in the first account field. Enter your answers in millions

Record the purchase.
Record the entry of net income.
Record the entry of dividends.
Record the entry of fair value adjustment.
b. Indicate the effect of this investment on 2013 income before taxes. (Enter your answer inmillions.)

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