Part 1

McDaniel Corporation manufactures surveying equipment. Journalize the entries to record the following selected equity investment transactions completed by McDaniel during the current year using the fair value method.

February 26 Purchased for cash 3,100 shares of Demon Inc. stock for $32 per share plus a $124 brokerage commission.

April 16 Received dividends of $0.45 per share on Demon Inc. stock.

June 18 Purchased 1,400 shares of Demon Inc. stock for $38 per share plus a $56 brokerage fee.

August 19 Sold 4,000 shares of Demon Inc. stock for $41 per share less a $100 brokerage commission. McDaniel assumes that the first investments purchased are the first investments sold.

November 14 Received dividends of $0.62 per share on Demon Inc. stock

Part 2

Deming, Inc. acquired $250,000 of Mercury Co., 5% bonds on May 1 at their face value. Interest is paid semiannually on May 1 and November 1. On November 1, Deming Inc. sold $80,000 of the bonds for 98.

Journalize the entries to record the following:

a. The initial acquisition of the bonds on May 1

b. The semiannual interest received on November 1.

c. The sale of the bonds on November 1.

d. The accrual of interest of $1,200 on December 31.