Zeuz Corporation is considering making a significant long-term investment in Arez Ltd., a young and very promising company. Zeuz decides to make a smaller investment first, and if Arez turns out to be successful, Zeuz intends to make an additional investment to reach significant influence. Arez has 110,000 shares outstanding.

On January 1, 2023, Arez issues Zeuz 10,000 shares for $400,000 in cash (so now there are 120,000 shares outstanding).

Extra info:

1. On November 1, 2023, Arez declares a total cash dividend of $180,000.

2. Arez reports $225,000 net income for 2023. Its stock price on December 31, 2023 is $38.

3. On November 1, 2024, Arez announces a total dividend of $270,000 to be paid on January 2, 2025.

4. Arez reports $360,000 net income for 2024. Its stock price on December 31, 2024 is $44.

5. On March 15, 2025, Zeuz is approached by an investment fund which offers to buy all its Arez shares for $55 per share, a 25% premium over the current stock price of $44. Zeuz accepts the offer and sells the shares on that day.

Required: Now assume Zeuz uses the fair value through net income model (FV-NI) to account for this investment:

a) Prepare the journal entries in Zeuzs books for the 2023 calendar year.

b) Prepare the journal entries in Zeuzs books for the 2024 calendar year.

c) Prepare the journal entries in Zeuzs books for the 2025 calendar year.

Please use the correct account names for FV-NI, and show how each number was calculated.