Mead Inc. began operations in Year 1, following is a series of transactions and events involving its long-term debt investments in available-for-sale securities. Year 1

Jan.		20		Purchased Johnson & Johnson bonds for $25,500.
Feb.		9		Purchased notes of Sony for $59,940.
June		12		Purchased bonds of Mattel for $45,500.
Dec.		31		Fair values for debt in the portfolio are Johnson & Johnson, $29,500; Sony, $49,350 and Mattel, $54,750.

Year 2

Apr.		15		Sold all of the bonds of Johnson & Johnson for $28,500.
July		5		Sold all of the bonds of Mattel for $39,350.
July		22		Purchased notes of Sara Lee for $15,500.
Aug.		19		Purchased bonds of Kodak for $18,800.
Dec.		31		Fair values for debt in the portfolio are Kodak, $19,075 Sara Lee, $17,000 and Sony, $62,000.

Year 3

Feb.		27		Purchased bonds of Microsoft for $159,800.
June		21		Sold all of the notes of Sony for $61,600.
June		30		Purchased bonds of Black & Decker for $55,400.
Aug.		3		Sold all of the notes of Sara Lee for $14,250.
Nov.		1		Sold all of the bonds of Kodak for $23,725.
Dec.		31		Fair values for debt in the portfolio are Black & Decker, $57,600 and Microsoft, $159,600.

Required: 1. Prepare journal entries to record these transactions and the year-end fair value adjustments to the portfolio of long-term available-for-sale debt securities.