On May 20, 2017, Montero Co. paid $1,000,000 to acquire 25,000 shares (10%) of ORD Corp. as

Question:

On May 20, 2017, Montero Co. paid $1,000,000 to acquire 25,000 shares (10%) of ORD Corp. as a longterm available-for-sale investment. On August 5, 2018, Montero sold one-half of these shares for $625,000.
1. Should the fair value or cost method be used to account for this investment on the balance sheet?
2. Prepare entries to record both (a) the acquisition and (b) the sale of these shares.