As a long-term investment at the beginning of the 2021 fiscal year, Florists International purchased 30% of Nursery Supplies Inc.'s 20 million shares for $60 million. The fair value and book value of the shares were the same at that time. During the year, Nursery Supplies earned net income of $70 million and distributed cash dividends of $2.00 per share. At the end of the year, the fair value of the shares is $56 million.

Required:
a. How would this investment be classified on Florists' balance sheet?
b. Prepare all appropriate journal entries related to the investment during 2021, under the fair value option, and in a manner similar to what Florists would use for investments in equity securities for which it does not have significant influence.

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