The following selected transactions relate to investment activities of Ornamental Insulation Corporation The company buys securities, not intending to profit from short term differences in price and not necessarily to hold debt securities to maturity, but to have them available for sale when circumstances warrant Ornamentals fiscal year ends on December 31 No investments were held by Ornamental on December 31, 2015 2016 Feb 21 Acquired Distribution Transformers Corporation common shares costing $420,000 Mar 18 Received cash dividends of $9,000 on the investment in Distribution Transformers common shares Sep 1 Acquired $960,000 of American Instruments' 10 bonds at face value Oct 20 Sold the Distribution Transformers shares for $455,000 Nov 1 Purchased M D Corporation common shares costing $1,500,000 Dec 31 Recorded any necessary adjusting entry(s) relating to the investments The market prices of the investments are (Hint Interest must be accrued for the American Instruments bonds ) 2017 Jan 20 Sold the M D Corporation shares for $1,587,000 Mar 1 Received semiannual interest of $48,000 on the investment in American Instruments bonds Aug 12 Acquired Vast Communication common shares costing $670,000 Sept 1 Received semiannual interest of $48,000 on the investment in American Instruments bonds Dec 31 Recorded any necessary adjusting entry(s) relating to the investments The market prices of the investments are Required 1 Prepare the appropriate journal entry for each transaction or event during 2016 (If no entry is required for a transaction event, select No journal entry required in the first account field ) (I have it all done for number 1 except the entry for October 20th, 2016 for above) 2 Indicate any amounts that Ornamental Insulation would report in its 2016 balance sheet and income statement as a result of these investments (Amounts to be deducted should be indicated with a minus sign ) 3 Prepare the appropriate journal entry for each transaction or event during 2017 (If no entry is required for a transaction event, select No journal entry required in the first account field ) 4 Indicate any amounts that Ornamental Insulation would report in its 2017 balance sheet and income statement as a result of these investments (Amounts to be deducted should be indicated with a minus sign )

The Answer is in the image, click to view ...

Answered step by step

Verified Expert Solution

Link Copied!

Question

1 Approved Answer

Posted on Sep 17, 2024

The following selected transactions relate to investment activities of Ornamental Insulation Corporation. The company buys securities, not intending to profit from short-term differences in price

The following selected transactions relate to investment activities of Ornamental Insulation Corporation. The company buys securities, not intending to profit from short-term differences in price and not necessarily to hold debt securities to maturity, but to have them available for sale when circumstances warrant. Ornamentals fiscal year ends on December 31. No investments were held by Ornamental on December 31, 2015.

2016
Feb.	21	Acquired Distribution Transformers Corporation common shares costing $420,000.
Mar.	18	Received cash dividends of $9,000 on the investment in Distribution Transformers common shares.
Sep.	1	Acquired $960,000 of American Instruments' 10% bonds at face value.
Oct.	20	Sold the Distribution Transformers shares for $455,000.
Nov.	1	Purchased M&D Corporation common shares costing $1,500,000.
Dec.	31	Recorded any necessary adjusting entry(s) relating to the investments. The market prices of the investments are:

(Hint: Interest must be accrued for the American Instruments bonds.)

2017

Jan.

Sold the M&D Corporation shares for $1,587,000.

Mar.

Received semiannual interest of $48,000 on the investment in American Instruments bonds.

Aug.

Acquired Vast Communication common shares costing $670,000.

Sept.

Received semiannual interest of $48,000 on the investment in American Instruments bonds.

Dec.

Recorded any necessary adjusting entry(s) relating to the investments. The market prices of the investments are:

image text in transcribed

Required:

1.	Prepare the appropriate journal entry for each transaction or event during 2016. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)

image text in transcribed

(I have it all done for number 1 except the entry for October 20th, 2016 for above)

2.	Indicate any amounts that Ornamental Insulation would report in its 2016 balance sheet and income statement as a result of these investments. (Amounts to be deducted should be indicated with a minus sign.)

image text in transcribed

Prepare the appropriate journal entry for each transaction or event during 2017. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)

4.	Indicate any amounts that Ornamental Insulation would report in its 2017 balance sheet and income statement as a result of these investments. (Amounts to be deducted should be indicated with a minus sign.)