In January of 2018, the management of Mann Company concludes that it has sufficient cash to purchase long term investments in stocks and bonds. The following occurred:

Feb. 1 Purchased 800 shares of SRI common stock for $32,000 plus brokerage fees of $800.

(Note: brokerage fees become part of the cost of the investment)

Mar. 1 Purchased 500 shares of FGH common stock for $15,000 plus brokerage fees of $300.

May 1 Purchased 60 $1,000, 12% XYZ bonds for $60,000 plus $1,200 brokerage fees.

These bonds are dated April 1, 2002.

July 1 Received a cash dividend of $.60 per share on the SRI common stock.

Aug. 1 Sold 200 shares of SRI common stock at $42 per share less brokerage fees of $350.

(Note: brokerage fees are deducted from the sales price to get the net cash proceeds.)

Sept. 1 Received a $1 per share cash dividend on the FGH common stock.

Oct. 1 Received the semiannual interest on the XYZ bonds.

Oct. 1 Sold the XYZ bonds for $63,000 less $1,000 brokerage fees.

At December 31, the market value of the SRI and FGH common stocks were $39 and $30 per share, respectively.

a) Journalize the transactions.

b) Prepare the adjusting entry at December 31, 2018 to report the investments at market value.