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Please prepare the journal entries and the adjusting journal entries.

On January 1, 2018, SFI purchased bonds issued by Harvard Investment Company (HIC). The bonds mature in 20 years at $1 million. The stated rate of interest on the bond is 4% and interest is paid semi-annually on July 1 and December 31. When the bonds were purchased the market interest rate was 6%. On September 30, 2018 because market interest rates had fallen to 5%, the company sold bonds with a maturity value of $300,000. As of December 31, 2018 the market rate was still 5%. The company is planning on holding the bonds to maturity and see this as a long-term investment. On June 1, 2018, SFI purchased 38% of the common shares in Yale Incorporated (YI) for $450,000 when YI's stock price was $22 per share. SFI plans to incorporate YI into their business model and thus, have significant influence over YI indefinitely. SFI had an appraisal done on the assets of YI and found that the fair value of the assets were higher than their carrying amounts by $60,000 which was solely related to the computer equipment. The computer equipment has a remaining useful life of three years as of June 1, 2018. YI declares dividends quarterly on March 30, June 30, September 30 and December 31. In 2018, the total dividend at each declaration date was $20,000. Dividend payments are typically made three weeks after declaration. At the end of 2018, YI reported net income of $180,000. On December 31, 2018, YI's stock price was $28.50 per share. On January 1, 2018, SFI purchased bonds issued by Harvard Investment Company (HIC). The bonds mature in 20 years at $1 million. The stated rate of interest on the bond is 4% and interest is paid semi-annually on July 1 and December 31. When the bonds were purchased the market interest rate was 6%. On September 30, 2018 because market interest rates had fallen to 5%, the company sold bonds with a maturity value of $300,000. As of December 31, 2018 the market rate was still 5%. The company is planning on holding the bonds to maturity and see this as a long-term investment. On June 1, 2018, SFI purchased 38% of the common shares in Yale Incorporated (YI) for $450,000 when YI's stock price was $22 per share. SFI plans to incorporate YI into their business model and thus, have significant influence over YI indefinitely. SFI had an appraisal done on the assets of YI and found that the fair value of the assets were higher than their carrying amounts by $60,000 which was solely related to the computer equipment. The computer equipment has a remaining useful life of three years as of June 1, 2018. YI declares dividends quarterly on March 30, June 30, September 30 and December 31. In 2018, the total dividend at each declaration date was $20,000. Dividend payments are typically made three weeks after declaration. At the end of 2018, YI reported net income of $180,000. On December 31, 2018, YI's stock price was $28.50 per share